Yesterday when I wrote my post about Viktor Orbán’s latest action plan the complete text of the speech was not yet available. Today it is, and therefore I think I should mention a few choice sentences from it before I talk about what we learned about the “birth” of the proposal that by now most people think is not only ill-conceived but also illegal.
The speech was studded with anti-foreign and anti-capitalist pronouncements. According to Orbán “people who speculate on ruining the Hungarian people or who want to get rich at their expense … are betting on the wrong horse.” He indicated that there are forces in the world that want “to assault Hungary.” In fact, Hungary is not the only victim of “these speculators.” It was in the interest of “these groups” to lend money to the countries and here is the result: “Europe is in trouble. But not so Hungary!” (This last sentence is incomprehensible. After all, Hungary is very heavily indebted which, according to Orbán himself, is the paramount reason for Hungary’s economic woes.)
Orbán also emphasized in his speech that the government “studied the legal situation and found that Hungarian law allows Parliament to intervene in the case of mortgage contracts and change their terms.” It turns out that even as Viktor Orbán uttered these words he knew full well that this statement was untrue.
You may recall that János Lázár, the leader of the Fidesz parliamentary caucus, claimed that the idea of paying off forex loans in one big lump sum at a reduced rate came from his fellow MPs. The caucus unanimously accepted the proposal and asked the government to consider the idea. Already yesterday I had my doubts about the veracity of this description of the chain of events. Well, today my doubts were confirmed.
The true story was revealed by Index, a very popular Internet paper, that got hold of a document dated September 9, that is Friday. According to the document the lawyers at the Ministry of Administration and Justice (Tibor Navracsics) expressly warned the government that the move would be illegal. Thus, the plan had been hatched earlier. Perhaps as early as late July or early August when it became clear that the economic forecasts were based on wrong assumptions and that further austerity measures were necessary. At this point Viktor Orbán made a short announcement about the gravity of the situation and said that he would deliver a speech that would contain all his answers to the crisis.
Most likely it was at this junction that someone, most likely György Matolcsy, came up with the “solution” to one of the many problems Hungary is facing at the moment. But surely, the legality of the proposal had to be ascertained. Hence the September 9 document coming from Tibor Navracsics’s ministry. The legal opinion indicated that there was no possibility of getting around Hungarian legal theory and practice, and the recommendation was to abandon the plan. But Orbán went ahead anyway, though he did mention in his speech the possibility of negative reaction from “international forums.” No problem, Hungary will handle it.
Since then the Banking Association announced that early repayment of foreign currency debt at an exchange rate 20% below market rates is “unacceptable … because it leads to substantial financial, macroeconomic and growth risks.” According to the news release “the banks will have no other choice but to turn to the Constitutional Court and the relevant authorities of the European Union.” The Austrian banks backed by the Austrian government are planning to do the same at the European Commission and the European Court of Justice.
Yet it seems that Orbán will go ahead with this harebrained idea in spite of the fact that many economists who actually sympathize with the current government tried to change his mind. You may recall that the Monetary Council responsible for setting interest rates was enlarged by four new members, all Fidesz appointees. Apparently these people went to Kötcse, where right-wing intellectuals and members of the government and Fidesz meet for a day of picnicking and a series of lectures and discussions. There they tried to talk Orbán out of such a move. They failed. They even talked to Lajos Kósa. Perhaps he can influence Orbán. No go. I really wonder where all this dilettantism and bullheadedness will lead the country and with it the Orbán government.
Just to give you an idea of how haphazardly this government is running the country I will copy here a page out of Viktor Orbán’s parliamentary speech yesterday. We are able to take a look at the pages in front of the speakers on the podium because László Kövér, who doesn’t like journalists, exiled them out of sight, way above the podium. The journalists were rather unhappy until they found out that with a good camera they can see the notes of the speakers directly underneath them. Here is the page from Orbán’s speech:
Original ideas are scrapped in the last minute by the prime minister himself. So much so that there is no time to edit the document and make it more legible. New laws are introduced in the same haphazard fashion without any discussion with experts or regard for the people involved.
But if those tricky journalists up there could see Orbán’s notes they could also catch a glimpse of the notes of Ferenc Gyurcsány who was allowed to say a few words in connection with his case before the vote that stripped his immunity. It was a very hard-hitting speech in which he accused Viktor Orbán of staging a show trial and asked democratically minded people to unite against the dictatorial one-party system in the making. His speech lasted 10 minutes and his notes looked like this:
Gyurcsány obviously doesn’t need too many notes. The topics outlined above were faithfully and eloquently followed in his speech which I will translate tomorrow, but for the time being here is the original video: