As we know, the Orbán government doesn’t hide its intention to assist the development of a very rich Hungarian upper crust. Although Viktor Orbán prefers to talk about a “national middle class,” Orbán’s middle class is not exactly the kind of middle class we normally envisage. We are talking here about the super rich. Orbán and Fidesz are using the whole state apparatus to enrich those few very rich men who in turn are beholden to the party and the government and who therefore are supposed to fill the coffers of Fidesz and most likely even the pockets of its leading politicians.
One common tactic is to award government contracts at inflated prices, often without competitive bids, from which the recipient is supposed to kick back a certain percentage to Fidesz and/or leading Fidesz politicians. The fattening of these big cats has cost Hungary a lot and not just in money. According to József Papp, a professor of economics at Corvinus University, the last year and a half was spent building up a strong Hungarian capitalist class and assisting them through more and more government orders and subsidies. This artificial and unnatural way of creating a domestic capitalist class is not good even for the Hungarian businesses involved because their growth is tied to government orders and they are at a loss in the competitive marketplace.
It is hard to ascertain how much is true about the alleged incredible graft that is going on, especially in the Ministry of National Development which just got a new head–a no-name minister without a university degree. It is widely believed that Mrs. László Németh (until recently we didn’t even know her first name) is a front behind whom important businessmen with close Fidesz connections stand.
József Debreczeni in his latest book on political corruption (Slough of Politics) spends several chapters on party finances. According to Hungarian law parties can spend very little money on election campaigns. One million forints per candidate. This is naturally not enough, and the money that is actually spent–about ten times more than the official figure–is ill gotten. No one knows exactly the source of this money but I suspect that most of the under-the-table money comes from Hungarian businessmen who win government contracts only if they hand over part of the money to the party “comptrollers,” a position that came into being in 1989-1990 when some of MSZMP’s incredible wealth that had accrued during the Rákosi and Kádár regimes had to be converted into invisible business ventures. It was MSZP that had the first comptroller, but Lajos Simicska, the man who handled Fidesz’s affairs, turned out to be much better at illegal wheeling and dealing. While the socialists and the liberals were caught at least once, Simicska’s “financial empire” was never seriously threatened. There was talk but that was all.
Simicska is a very good friend of Viktor Orbán from his high school and college days. According to some, he is one of the most influential people in the Orbán circle because the prime minister considers him to be a financial genius. Perhaps he is, but most people also describe him as an unscrupulous and ruthless fellow without any moral compunctions.
Simicska is surrounded by other influential businessmen who are now occupying important positions either in government or as business leaders ready to reap the benefits of Fidesz’s new position. One such man is a lawyer from Szolnok, the birthplace of Anikó Lévai, wife of Viktor Orbán. His name is Zsolt Nyerges, and he recently ventured into the business world. The Hungarian media know little about Nyerges because he is very good at staying out of the limelight.
Another businessman is Csaba Baji who lately became the CEO of Magyar Villamos Művek (Hungarian Electric Works). Interestingly, he is also from Szolnok. Several other people close to Simicska and Nyerges ended up in the Ministry of National Development. For example, Zoltán Schváb, assistant undersecretary in the ministry, or Ágnes Molnár, undersecretary responsible for the coordination of economic development. Another undersecretary, Sára Nemes, is also from Szolnok. Thus the whole top echelon of Tamás Fellegi’s ministry, including the former minister himself, is in one way or another connected to Lajos Simicska and his close friend Zsolt Nyerges.
Mrs. Németh’s performance before the parliamentary committee was miserable. She read whatever little she knew about the workings of the ministry and when it came to questions, she couldn’t answer most of them even with the help of the undersecretary sitting next to her. Apparently even the Fidesz members of the committee were taken aback, but being good partisan politicians they voted for her. According to Magyar Narancs, her appointment doesn’t come as a surprise to people in the know because Mrs. Németh belongs to the circle of Nyerges, Simicska, and Baji. After the elections Mrs. Németh, in spite of her lack of a university degree, was put into a very high position in the Magyar Fejlesztési Bank, a state-owned investment bank which seems to be the private wealth fund of the Fidesz government. (It just spent 4 billion forints buying the Ferencváros (Fradi) soccer team and the club’s real estate holdings. A poor team and a losing business venture.) She was made a member of the board of MVM (Magyar Villamos Művek) where the CEO is Csaba Baji, as I said a close associate of Nyerges and Simicska.
The general impression has been for some time now that Fellegi’s ministry is under the influence of the Simicska-Nyerges group. It is the Ministry of National Development that receives all the EU subsidies, some 1,200 billion forints. Already one of Nyerges’s companies, Közgép Zrt., received at least 200 billion forints in government contracts in the last year and a half.
And here is the new minister. The only female minister in the second Orbán government.
Mrs. László Németh
Mrs. László Németh seems, outwardly at least, formidable. However, she behaved very timidly before the committee which was chalked up to nervousness. Most people, including some Fidesz politicians and supporters, think that she is not qualified and will only make sure that government contracts end up with the “right people.” The national bourgeoisie!