Hungary’s Viktor Orbán, the great European statesman

Of course, the title was written in jest. The Hungarian prime minister’s performance in Brussels surpasses my lowest expectations of his ability to navigate the “High Street of Europe.” In case you’ve forgotten, it was Viktor Orbán a couple of years ago who criticized Gordon Bajnai and his government as provincial country bumpkins who are simply lost in the world of European politics. But, just wait, he will come and from there on Hungary will be strutting along on the High Street of Europe. It turned out a little differently, as we can see.

The Hungarian prime minister is most likely pegged as an unreliable politician whose words mean nothing. After all, a day before the European summit, according to The Wall Street Journal, he “called on Europe to remain united as it draws up new plans to fight its debt crisis.” So, great was my surprise when I saw a late night report of The New York Times that “efforts to get unanimity among the 27 members of the European Union, as desired by Germany, failed as Britain and Hungary refused to go along for now.” The article further stated that two other countries, the Czech Republic and Sweden, said they wanted to talk to their parties and parliaments at home before deciding.

Viktor Orbán arrives in the European Parliament

Index, the Hungarian on-line paper, reported in the same vein in the early morning. Sarkozy named Hungary as one of the two countries that refuses to go along. Herman Van Rompuy, the president of the European Council, did not mention Hungary by name, but it was clear from his phrasing that he was talking about Britain and Hungary. The Dutch prime minister also mentioned Hungary by name.

The members of the Hungarian delegation wouldn’t talk with either foreign or Hungarian reporters, but Viktor Orbán promised a press conference for the morning. Meanwhile, journalists were busy writing about the two recalcitrant members. Nobody was terribly surprised about Great Britain, but Hungary’s “no” was inexplicable. Stefan Wagstyl of The Financial Times began his article by saying that “adversity makes strange bedfellows.” According to him, this marriage is a mesalliance. In case you are not familiar with this word it means “a marriage with a person of inferior social position.” That was not nice!

A few hours later, Orbán was no longer so firm in his opposition. He had changed his tune. He will have to turn to the Hungarian parliament which must vote on the question of adherence to the treaty. After all, it impacts on Hungarian sovereignty and he is not authorized to make such a weighty decision on his own.

Hungarian papers pondered the question: who misunderstood whom? Did Sarkozy, Rompuy and the Dutch prime minister misunderstood Orbán or did Orbán change his stance after a few hours of sleep and, I suspect, a few persuasive conversations that outlined the terrible consequences of his decision? As it was, the Hungarian forint sank 1% within a couple of hours. I’m sure the knee-jerk forex reaction gave Orbán a taste of what might follow in the next few days. This recognition might have helped change his mind.

Meanwhile the Hungarian opposition parties and the financial analysts were baffled, some of them horrified. Péter Balázs, foreign minister in the Bajnai government, simply couldn’t understand the reasoning behind Orbán’s decision. He especially couldn’t understand why Orbán would behave like this just before the negotiations with the IMF-EU delegation. Attila Mesterházy of MSZP considered Orbán’s behavior outright crazy, adding that “even stupidity and stubbornness have their limits.” LMP’s Gábor Scheiring, who normally represents the party in economic questions, said that “Prime Minister Viktor Orbán is just as incompetent as the ministers of his government.” According to Ferenc Gyurcsány of the Democratic Coalition, “Viktor Orbán with his contradictory statements and wavering viewpoints confused the world, the European Union, Hungary and perhaps he himself got confused.” In his opinion the prime minister made perhaps the most damaging foreign policy decision of the last twenty years.

Well, I think that is a bit of an exaggeration. Viktor Orbán already has a very bad reputation inside and outside of the European Union and I doubt whether anyone in that conference room expected a sterling performance from the Hungarian prime minister. Gyurcsány rather sarcastically remarked that “the market at Teleki Square [a flea market] is not the same as The City, and the Hungarian forint is not the same as the pound sterling.” He thinks that the Hungarian negotiating team’s position vis-à-vis the IMF and the EU will be a great deal more difficult after this unfortunate affair in Brussels.

In any case, Orbán sounded a lot smarter by this afternoon. He admitted that the 2012 Hungarian budget must be completely reworked. He also announced that “the Hungarians and the Brits will never sit in the same boat.” He suddenly considered the situation after the summit “new and exciting.” He was ready to give up some of his “illusions,” whatever that means. He emphasized that “Hungary made a commitment to join the euro zone while the Brits never will.” Suddenly he discovered that Hungary will have to give up some of its sovereignty. That’s called a change of heart. A very sudden change of heart.

Jobbik naturally is not at all happy about Hungary’s decision to join the other 25 members because if it depended on this neo-Nazi party Hungary shouldn’t have joined the European Union in the first place. As for Orbán’s decision to let parliament decide whether to adhere to the treaty, Jobbik’s spokesman rightly pointed out that the decision will not be that of the Hungarian parliament “but the voting machine of Fidesz which is being directed by Viktor Orbán alone.”

The prime minister’s expressed opinion about the role of the parliament is very different. He tried to emphasize the importance of this body. First, he announced that the government will not interfere with the outcome of the debate or the vote on the issue. Later he said that he expects more shades of opinion than there are parties in the Hungarian parliament.

For the time being Orbán is sticking with his original idea that there is no hurry because after all a final vote by the parliament is not necessary before March 2012. However, I wouldn’t be surprised if he changed his mind on this issue as well. It certainly would help the negotiations with IMF-EU delegation if Hungary’s commitment to the eurozone treaty were clear as early as possible. Of course, the question is whether Orbán really wants an agreement or not. My feeling, especially after today, is yes. He has no choice.

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Paul
Guest

Here in the UK, this is being reported as just the UK behaving in its usual way, with Hungary, Sweden and the Czechs only waiting until their parliaments have been consulted. There is no ‘UK+Hungary’, as reported elsewhere.
At least, that was as BBC radio reported it in the afternoon. But I note that a BBC website report, timed at 16:37, says “Hungary originally said it would also remain outside the deal but has now changed its stance”.
It’s interesting that amongst commentators, analysts, MPs, etc questioned about this, there was a universal expression of horror that the UK should be linked with Hungarian tactics.
As most people here have no idea who Orbán is, let alone what he’s doing to the country, I found this rather puzzling.

Paul
Guest
Incidentally, I feel duty bound to try to explain the UK’s strange behaviour on this issue. I’m used to being embarrassed by UK behaviour in the EU, but this is bad, even by ‘our’ standards. This madness has two drivers: First is the strong Eurosceptic feeling that has been present in the UK right from the early days (and is now a dominant ‘feeling’ amongst the ignorant masses). This means that any government, left or right, has to play any EU issues very carefully, to try to balance what’s good for the country against bad political fallout from upsetting the Euro sceptics (who have most of the press on their side). Secondly, and perhaps more importantly at the moment, Cameron has a very strong Eurosceptic faction in his party, and absolutely has to keep them happy if he’s going to be able to continue as PM. Because of the expenses scandal, there was an unusually large number of new MPs in the last election, and the majority of the new Tories were of the Eurosceptic right. Most of them regard Cameron as soft and having made a mistake in forming a coalition with the Liberals. The last two Tory governments… Read more »
Guest

Paul, I agree with you about Cameron. Maybe the Lib-Dems will change their mind and court Labour next time …
BTW, here’s one of my favourite sites:
http://liberalengland.blogspot.com/

Kirsten
Guest
Paul, irrespective of whether they know Viktor Orban, for me it sounds as being left with just one, and above all an “East European” ally, that is too much. You could have also inserted “Slovakia” or even “Moldavia” (pick any country people associate easily with ‘mysterious’ and ‘unknown’ East). That is my guess, certainly not too kind (to Brits). But I remember that there was a tourist guide written some years ago to a fictional East European country called Molvania, full of all the oddities that people who do not know East Europe appear to love. It was told that it was a parody but perhaps East European reality was still not odd enough… I cannot yet make up my mind about whether David Cameron made such a big mistake. I fully agree with a British commentator that it is a shame to present the interests of the financial industry as British national interests. But for Europe, I am not sure about the damage. The other countries can go ahead and perhaps design some ‘better’ rules, probably more along the German and French lines (which are in any case already a hard-won compromise of very different ideas) than along British… Read more »
Paul
Guest
Kirsten – I think OV reacted instinctively at first and automatically resisted anything that would impose more controls from the EU. But then he had second thoughts or wiser counsel prevailed, and he realised that the IMF would not be impressed at yet another display of ‘unorthodox’ policy. Which is interesting, if I’m right, because it would indicate just how badly they need the IMF money. But then, with the first of the 2008 loans due to be paid back next year, I don’t see how they can avoid an IMF loan. There’s a nice irony in OV being forced back to the IMF because of the ghost of past MSzP dealings. It’s almost a Dickensian Christmas story – Gyurcsány clanking into OV’s pre-Christmas nightmare as the Ghost of Prime Ministers Past… As for the UK situation – listening to the in-depth coverage tonight on the 10 pm R4 news programme, every single expert and analyst they asked said it was a bad move. I’ve never heard a piece like that before where none of the people they asked supported the other view. In the end they had to resort to asking Euro sceptic Tory MPs what they thought, just… Read more »
Kirsten
Guest

Paul, in my impression there is no long-term answer available currently. You have financial markets that urgently ‘need’ a short-term solution (the central banks ‘buying’ all the government debt that they are afraid of, which can be potentially any government debt), while countries and governments, even under pressure, will not be able to devise and implement ‘big-bang’ reforms with instant results. Not to speak of that the ‘reforms’ in the financial sector, which brought us into this mess in the first place, are not progressing much (current observers can even believe that the problem is ONLY in the state budgets of countries such as Greece or Ireland, but of course also in that of France or Germany). The reforms of the financial sector are – out of ‘mysterious’ reasons – not demanded by the ‘investors’ with equal zeal, on the contrary, Britain has because of that even said NO to new EU treaties (‘defending UK interest’). That commentators are depressed is not surprising.

Wondercat
Guest

Writing from London:
1) What was to be expected from the creation of the Euro other than a unified Europe, first on economic, then on political terms? The Zollverein succeeded in establishing predominance of Prussia among German-speaking nations, the EU is doing the same for Germany within Europe. Fascinating to see three hundred years of British balance-of-powers foreign policy brought to an end with the fusion of French and German interests (or of the interests of French and German banks; House of Rothschild all over again!), and very difficult to imagine the Plan B that the Foreign Office must now set into motion.
2) Cameron has sacrificed Britain as a whole to the interests of financiers inside the City of London; 1% vs 99%, again.
3) If this stroke has appeased Conservative backbenchers, has it at the same time enraged Liberal ones? Not that their opinions matter to the courses that this Government will follow, mind you…

Sophist
Guest

“Cameron has sacrificed Britain as a whole to the interests of financiers inside the City of London”
I’m not sure he has even done that. The financiers were happy for the UK to fight for them within the EU. I’m sure that if, in a future in which the UK is excluded, it makes more commercial sense to up sticks and move to – say, Frankfurt – they will. They won’t takes losses for loyalty.
As for Jobbik, etc. Hungary is not the only EU country with a nationalist party. My guess is the EU block will fragment, soften their position before this new treaty is done.

Wondercat
Guest

@Sophist: Indeed. Quite possibly a temporary, an unsuccessful sacrifice. Mammon is never sated.
If as you say, it makes more commercial sense to move along, then only a matter of time, surely, till they decamp for… well, Frankfurt is likely, I suppose.
I was about to write “…for Budapest” but one thread can accommodate only so many sick jokes.

Odin's Lost Eye
Guest
Wondercat You moralist by saying ** “Mammon is never sated” ** Mammon is nothing to doo with it! The whole problem is the Euro and is due to certain nations within the Euro Zone badly over spending. This is a common currency of 23 nations within the EU and it is their problem to sort it out. These nations established a new Central Bank in Frankfurt, and despite warnings, from amongst others the Bank of England, did not establish a real central banking authority. This authority should have had the right of oversight of the financial matters amongst its clients. This is something all prudent bankers do. The ECB has no real democratic masters to report to and to be kicked by (i.e. the European Parliament), nor does it have shareholders to regulate it as did (and still does) the Bank of England. The ECB’s Charter is incomplete and it is up to the members of the Euro Zone (and no one else) to put this right. The Governor of the ECB refused to buy up the Euro zone’s sovereign debt as it was not in his charter to do so. The outlines of the new charter and agreement contained… Read more »
Kirsten
Guest
Odin, there are two sides to any overborrowing, which makes a solution to the current problem so difficult. And within the current monetary system, even private bank ‘lending’ does not need earlier savings, a lot of the loans made during the last decade were simply created ‘just so’. You are now asking and making the central banks justify (retroactively, so to speak) through their function of lender of last resort many deals done by the private and public agents in the last years. They are now providing the liquidity that is so much needed to restore ‘confidence’, apparently because the lending that occurred so vigorously before had a rather shaky basis (which of course turns out without earlier warning). It is this combination or amalgamation (I do not know a proper word for it) that makes it so difficult. To let the Fed, the Bank of England or the ECB do the dirty job, is a short term solution, true, but not much more. Financial markets will find out that this is no ‘long-term solution’ as soon they realise that they already get all that they can get. Nobody will be able to rectify for them investment turned out sour,… Read more »
Member

About Hungary… I hope this forum is still about that. lol
Orban wanted yo be part of the EU for all its benefits. Not for a moment he imagined that there could be “hard times” or “sacrifices”. As Orban’s record clearly shows he is in “for better” and not “worst”. He is in “for richer” and not “for poorer”. His “friendship” toward anyone and everyone is guided by his path to popularity, fame and money. He never ever sacrificed anything. I am not talking about something big here as sacrifice, but even about the price of an airplane ticket to go and participate in personal events. Check it his friends and who he talks about dearly as a politician.
If he changed his mind regarding the EU summit, it is driven by something more, then Hungary’s best interest. Someone talked to him, and that was not one of his shallow best buddies, as they have simply do not have the brain or the will. I am certain that there is something on the background that Orban felt would threaten his political carrier.

Wondercat
Guest

@Odin / Some1: Nem szolgálhattok Istennek és a Mammonnak… there you go, Some1! A Hungarian touch. **grin**

Kirsten
Guest

some1, of course it is about Hungary but the EU, how it functions and what the main problems are has repercussions for Hungary and for how much the EU will interfere with what OV is doing. The last summit for instance also showed that the prime ministers have at least equal power with the Commission and the EU institutions. This could also become a major problem because OV could claim that the Brussels institutions should not interfere in affairs that are solved “inter-governmentally”. We will certainly focus on Hungary very soon again but the problems of the EU are not without importance for Hungary.

Member

Kirsten: “This could also become a major problem because OV could claim that the Brussels institutions should not interfere in affairs that are solved “inter-governmentally”
Good point.

Member
One possible interpretation of Orban’s apparent U turn is that he is trying to keep his options open. It seems that he has put consultation with the Hungarian Parliament on the long finger, referring to the EU proposed timetable of March as a reason for his delays. He can give the impression that he is now in favour, but change his mind later if needs be. The summit deal on Friday seems to commit members to a new fiscal rule compelling a balanced or surplus budget. To achieve that in Hungary Orban will have to bring in the mother of all austerity plans; this will be of a Bokros package magnitude. This is contrary to everything that he has promised over the past 8 years, so I don’t know how he is going to justify it. I note that the plan is to make the balanced budget rule part of the constitution of each member state, with “an automatic correction mechanism that shall be triggered in the event of deviation”. Interesting given the restriction of the powers of the Constitutional Court in budgetary matters. If Orban gets time he will see if the markets respond positively to the new deal.… Read more »
Paul
Guest

“I don’t know how he is going to justify it”
He will spin it, as usual, and the compliant, ignorant, masses will accept the spin.
Believe me – I live with this. Something happens that causes (or should cause) OV embarrassment, Fidesz spin it, some hours later the phone rings, my wife talks to her mum, my wife reports that I was “wrong” (yet again) and gives me the “true” version of events supplied by her mother.
I’ve given up trying to argue this, as it is starting to cause serious stress in our marriage, so now I just play a little game with myself of trying to guess how each event will be spun. Sadly, I’m doing pretty well so far.

Paul
Guest
On a less personal level – he actually doesn’t have much choice. Unless he is actually prepared to take the country down with him (and we have to hope he isn’t quite that mad), then he is going to have to borrow money from the IMF AND he is going to have to bring in some pretty severe austerity measures. I can’t see any way round this. He can’t keep stealing pension funds and taxing foreign companies, he’s got to get hold of some serious money from somewhere – and that isn’t going to be China. So, in the next year or so, he will have to start raising taxes as much as he can (which will be interesting, given that VAT is already at a record high and the flat tax is sacrosanct) and he will have to start cutting state spending drastically. To a country as used to generous state spending as Hungary, this is going to be a even bigger blow than in most other countries. It’s going to get a lot less comfortable being a Hungarian. But, as I’ve said, he will spin this, and the spin will be generally accepted (if not quite as generally… Read more »
Eva S. Balogh
Guest

David: “It seems that he [VO] has put consultation with the Hungarian Parliament on the long finger, referring to the EU proposed timetable of March as a reason for his delays.”
Oh, that’s old story already. Parliament will ponder the question next week. I guess he realized that he is in trouble.

Eva S. Balogh
Guest

One more thing. It must have been hard for Orbán to put the question up for debate as soon as next week. It was Gyurcsány who suggested that he does that given the dire situation Orbán managed to create.

Paul
Guest

Another little tidbit to add to the debate on how much the EU hates Hungary:
“Hungary received over HUF 1 trillion in EU funds in 2010, State Audit Office says”
http://www.realdeal.hu/20111208/hungary-received-over-huf-1-trillion-in-eu-funds-in-2010-state-audit-office-says/
Also worth a read – the politics.hu piece I found this link in:
http://www.politics.hu/20111212/why-hungary-missed-a-really-good-opportunity-to-shut-up/
A trillion (‘short’ trillion, for Odin’s benefit) forint a year works out as* 2.7 billion Ft a day! Or 100,000 Ft for each man, woman and child in Hungary.
In Euros, that’s (I think) about 9 million a day, or nearly 12 million in dollars.
*both my calculator and my brian are too old for such vast numbers, so I may very well have these calculations wrong.

Ron
Guest

Paul: *both my calculator and my brian are too old for such vast numbers, so I may very well have these calculations wrong.
Your calculations are right. But we are talking about money that is available to Hungary. Actually only 17% is only allocated so far.
Of the previous money the government was only able to spent 70%.
And I think it will become less in future, as Transparency International stated that only 50% of the tenders are done correctly and the rest not. That means that these 50% needs to be paid back.

Guest

I just found an interesting snippet of information in the comments on this article:
http://www.standpointmag.co.uk/features-march-11-a-hungarian-democrat-takes-on-the-old-guard-tibor-fischer-viktor-orban-fidesz?page=0%2C0%2C0%2C0%2C0%2C0%2C0%2C0%2C0%2C0%2C3
“Just ask the PM, how many of the founding 37 memebers of Fidesz are in government positions? None. He got rid of every one of his original friends, however cherishes the friendship of Zsolt Bayer, a journalist who started at Nepszabadsag, but now is a leading voice on the far right, using disgusting language that your papar wouldn’condone about Jewish artists like A. Schiff and Gy. Konrad .”
Anyone know anything about this Mr Tibor Fischer ?
“Standpoint” seems to be a very right-wing British publication …

Paul
Guest
Jesus! That was a revelation. Thanks for posting that link, Wolfi – that’s the last Tibor Fischer I’ll be reading. Standpoint is a new (2008) British “cultural and political” weekly, which Wikipedia describes as “broadly centre-right”. (Although you always have to bear in mind with Wikipedia that we don’t know who wrote their article, and the suspicion with new publications is that it just might be someone from the publication itself.) One of the rules-of-thumb that I’ve developed over the last 50 years is that anything with the word ‘freedom’ in its title or aspirations is usually pretty right-wing. And, according to Wikipedia, “Standpoint describes its core mission as being “to celebrate western civilisation”, its arts and its values – in particular democracy, debate and freedom of speech – at a time when they are under threat.” Which sounds pretty much like code for “quite far to the right” to me. As for Tibor Fischer, he is a British writer of Hungarian descent (his parents were Hungarian refugees). His first Novel ‘Under the Frog’ is well worth a read. It is both very funny and also paints a very realistic picture of 1956 (I’d love to know what Éva thinks… Read more »
cba
Guest
I asked TF about his political views during an interview about Its Good To Be God around three years ago, and was quite shocked and appalled to discover that he was a Fidesz fan. “Anyone but the Communists” seemed to be his main rationale. He was Telegraph correspondent to Budapest in the late 80s-early 90s, meaning that he was in with Fidesz practically from the get go. In fact he had just lent petrol money to Tamas Deutch before the latter was arrested in Prague in 1989. The last line of his short bio used to read “He is owed money by several Hungarian politicians,” for this reason. He struck me as a Tory, and the fact he worked for Telegraph in his early 20s would evidence this, but lets be honest, what we witness in this article is a middle-aged man fondly looking back at what must have been a very exciting time, when he was younger, thinner and had more hair, with the feeling that he had witnessed history in the making. Under The Frog was fantastic, if a little lacking in plot, and The Thought Gang and even Don’t Read This If You’re Stupid were enjoyable too.… Read more »
Paul
Guest

An excellent summary, cba – spot on.
Good to be God was appalling!

Guest

Thanks, Paul and cba!
There’s a lot of these “Freedom-oriented” right wing publications around in Britain …
The good news is, that it’s usually fairly easy to find out “Wes Geistes Kind” they are …
OT:
Now back to helping my wife with baking little surprises for Christmas …

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