Increasing pressure on the Hungarian government

This morning I was still planning to write about how the state-controlled Hungarian television presents news. Or rather, how the evening news on MTV doesn’t give credible information about the events of the day. I will return to the topic soon because during the holidays I had more time than usual to watch Hungarian television. Unfortunately, I came to the conclusion that most Hungarians, even those who watch MTV’s news or listen to MR’s news programs, are badly underinformed. Or, one can even say, misinformed. On the other hand, some of the right-wing but independent newspapers and TV stations showed surprising boldness, especially in comparison to the state-owned media.

Here, however, I would like to talk about the renewed effort of the United States and the European Union to influence the course of events in Hungary. I think that by now there is no question that if Viktor Orbán isn’t stopped he will soon be in a position to introduce a quasi-dictatorship in Hungary. Today several people, most of them living abroad, phoned in to György Bolgár’s program and complained that the Hungarian people and Hungarian journalists didn’t raise their voices in time against Viktor Orbán’s regime when it was clear from at least the mid-1990s that Fidesz’s aim was to introduce a regime similar to that of Mussolini’s fascism. They are baffled by the relative passivity of the population. Indeed, let’s face it, the opposition under the best of circumstances manages to gather only a few thousand people at their demonstrations.

Yes, I get angry too when I hear from friends who have just returned from a visit to Hungary that “people are not interested in politics.” I angrily answer that “in that case they deserve what they get,” but when I calm down I realize that Hungarian democracy is still in its infancy. Many people don’t even understand how democracy works. Supporters of Orbán justify the policies of the government by pointing out the overwhelming mandate Fidesz received at the polls. They seem quite incapable of understanding that regimes, even if they have the overwhelming support of the population, might be undemocratic and evil. It is enough to think of Hitler’s Third Reich.

By now the initial support of 53% of the voters that brought Fidesz to power has dwindled, but inside of parliament a two-thirds majority in seeming unison votes mindlessly on hundreds of new laws that will not only affect the everyday lives of the people but that are steering the country away from democratic principles upon which Hungary’s Third Republic was built in 1989-1990. Fidesz politicians don’t even make a secret of the fact that “their democracy” is not the same one the democrats at the Round Table had in mind. János Lázár, head of the Fidesz caucus (akin to the majority “whip” in the American Congress), said in an interview that “with lots of American help a consensual democracy was established in Hungary in 1989-1990 but that doesn’t mean that a couple of decades later only that kind of democracy can exist.” Instead, he advocates “a majority democracy” which is more effective. Translated into plain English, it means that “we will run the country and you shut up.”

I’ve written at length about the European Union’s dissatisfaction with the way Hungary is heading. Three letters reached Budapest from Brussels alone. At the same time signs of renewed American efforts were visible. First, U.S. Ambassador Eleni Tsakopoulos Kounalakis’s letter appeared in Heti Válasz, subsequently politely rebuffed by János Martonyi, Hungary’s foreign minister. Then Thomas O. Melia, assistant undersecretary in the State Department, gave a couple of interviews. To crown the American effort on December 23 came a letter from Hillary Clinton herself addressed to Viktor Orbán. According to Charles Gati, a Hungarian-born American political scientist who saw it, Clinton’s letter is “a kind of last warning.” At least this is what became clear from a conversation György Bolgár had with Gati on December 27 on “Let’s Discuss it!”

 

Viktor Orbán doesn’t look happy listening to Hillary Clinton on June 27, 2011

According to Gati, Clinton’s letter also touched on Klubrádió’s loss of frequency, which indeed is a terrible blow to Hungarian democracy. In fact Gati and Mark Palmer, ambassador to Hungary between 1986 and 1990, suggested that the American Congress consider reinstating the Hungarian-language broadcast of Radio Free Europe.

As we know, none of these letters made a dent in Budapest. The laws the European Union and the United States objected to and asked that they be tabled were passed, although some with minor alterations. The attacks on Klubrádió are continuing, and the two journalists who have been on a hunger strike for almost three weeks were just fired. Demonstrating MPs were carried away by force and detained for hours.

As for Hillary Clinton’s letter, the Christian Democratic László Varga didn’t mince words today in parliament. “And even Mrs. Clinton raises her voice! We would like to create a European law [on the churches and religion], not an American one which allows all the flowers to bloom” referring here to Mao Zedong’s well-known saying. In English this doesn’t sound as bad as in Hungarian where Hillary Clinton was referred to as “Clintonné nagyságos asszony.” Before 1948 there were all sorts of silly titles given to people of rank. The lowest was “nagyságos.” Everybody who had a high school education and a white collar job was “nagyságos úr” and his wife “nagyságos asszony” even if she was just a homemaker. People over a certain rank in the civil service or in the army were called “méltóságos.” So, poor Hillary Clinton didn’t fare too well in the hands of László Varga, the Calvinist minister who likes diversity of opinion so much that he hit his fellow MP Gábor Vágó, lying helpless on the ground after the LMP protest, on the head with his briefcase.

So, it is becoming quite clear that even strongly worded letters don’t make the slightest difference. We will see what will happen if there is a tangible sign of a financial threat. Because today the International Monetary Fund announced that no decision has been made on the resumption of negotiations with Hungary. Whether there will be negotiations at all depends on whether the Hungarian government is willing to discuss some of the “key policy issues.” If not, no negotiations.

Christoph Rosenberg, mission chief on Hungary, specifically mentioned additional concerns that emerged regarding new legislation proposed by the Hungarian government that led to an interruption in the discussions earlier this month. “If the Hungarian government is interested in proceeding on program discussions, it should demonstrate its willingness to engage on policy issues that are relevant to macroeconomic stability. This includes close consultation on the proposed central bank legislation and the financial stability law as part of the negotiations.” This is specific enough. If these laws go forward, as they are doing at the moment, there is no money. Your choice.

 

Christoph Rosenberg might not be so jolly next time in Budapest

But, of course, these two laws are no more than a small part of the concentrated effort to dismantle Hungarian democracy. And to tackle those problems the IMF-EU negotiating team’s threats are not enough. Here is where the Hungarian people must become engaged.

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Paul
Guest

In just under three days time (it’s 00:15 Thursday in Hungary as I type this) the new constitution comes into force. And most of what the EU and US are objecting to then becomes constitutional law.
Orbán isn’t going to back down.
And he’s going to have to find money elsewhere. So get your savings out of Forint – and out of Hungary – while you still can.
We’ve just found out that Anglo-Hungarian friends of ours who have been running a business in Hungary for the best part of 10 years have had enough and are moving back to the UK. And I don’t think they’re going to be the only ones.

Paul
Guest

The expected collapse of the Forint might have begun as well – it’s currently trading at just under 310 to the Euro, three Forint up from yesterday (having been steady at around 307 all through the holiday). It’s only 2 Forint short of its worst ever performance (March 2009).
Against the £ it’s trading at just under 370, it’s worst position since September 2007.
Against the CHF it’s not doing quite so badly, but it’s still the wrong side of the 250 ‘crisis point’ and lost 3 Forint in just one day’s trading today.
And if anyone feels at reassured by this slightly less bad performance, they should check out the FX chart (e.g. http://www.xe.com/currencycharts/?from=CHF&to=HUF&view=1Y ). The trend is clearly upwards, with 260 Ft to the CHF likely early in the New Year, and a new record of 270+ possible a month or two after that (and that’s assuming OV doesn’t do anything to frighten the markets more).
You have to feel for the poor sods who are still stuck with CHF mortgages.

nwo
Guest

I believe there is a fundamental collapse in faith in democracy and the value the population assigns to a democratic system. Economics are the paramount concern, and a desire for order is the second priority.
Faith in democracy was either never properly embedded in the culture or its perceived value was eroded over the past 20 years as Hungary produced a serious of corrupt and incompetent governments. A free press and an independent judiciary are great (though most people never experienced their value), but what the change in the system was really meant to bring was a rapid increase in prosperity. That has stopped and reversed (shortly after EU accession btw), and this is what the people care about.
The rest of us either feel sorry for ourselves or leave.

Guest

London calling! Blah! blah! blah!
Yes Eva – I have no doubt that being the new ‘Third Republic’ (now expunged in the new constitution of course) – and the concomitant teething problems of any new democracy – is the reason why people are disinterested. They don’t ‘Do’ democracy yet.
As an allegory – An American visiting Oxford asked a wise old gardener how he could get his lawns to look like those around the University colleges.
“Simple really”, he said “just mow regularly; feed periodically; and spike it now and again” – all the time the American seizing his every word of advice – “And when you’ve done it for 200 years you’ll have a lawn like this!”
OV has just happened in the wrong moment and is giving problems that even a mature democracy could handle.
I didn’t realise that the US took such an active part in the ’round table’ events 1989-1990; might explain Hillary’s concerns now – the presidential ‘Pillow talk’ (with Bill that is!) might have cemented her resolve now.
Your blog is as enlightening as ever – Thanks
(Btw and tch tch! – “even if she was just a homemaker.” – naughty!)
Regards
Charlie

Eva S. Balogh
Guest

CharlieH: “(Btw and tch tch! – “even if she was just a homemaker.” – naughty!)”
Why? The rank wasn’t based on her “achievements.” She was just entitled to it on account of her husband.
Therefore, this is a real put-down in case of Hillary Clinton. Don’t you think?

Joseph Simon
Guest

Yes, Orbán should listen to criticism. A point in case is Ms. B. Born, head of a federal office in the US. She warned Greenspan, the US Senate repeatedly of the impending financial catastrophe. She was marginalized, none of the major media took up her story. CNN was too busy reporting on Michael Jackson, Madonna and the Jackson girl taking off her bra. You see, CNN is no better than MTV.

Ron
Guest
Ron
Guest

The HUF/EUR 312.
http://www.xe.com/ucc/convert/?Amount=1&From=EUR&To=HUF
Where does it end today?

Ron
Guest

Joseph Simon: I assume you talk about the Born prophecy. She made that for the first time in 1996 the last time in 2003 (she then retired).
They should have listened to her at that time, but the signs were not there yet. With regard to VO they are there, and it is happening now.
For anybody interested in her story:
http://www.abajournal.com/magazine/article/the_born_prophecy/

Paul
Guest

The Forint passed 312 to the Euro at 13:00 (Hungarian time). It recovered to nearly 310, but it’s rising again now – just over 311 at 3:20.
It’s not exactly collapsing, but the trend is pretty definite – it’s lost 5 Forint since yesterday morning.
God alone knows what will happen if the IMF refuse to restart talks in the new year.
And in case the JBs of this world think I’m enjoying this, as well as having family and property in Hungary, I have half a million Forint in the bank – which I can’t withdraw or convert!
When we put that money in it was worth about £1,670 – today it’s worth just £1,345. That’s £325 down the toilet in just 5 months – nearly a 20% loss (and that’s close to 50% a year!).

Joseph Simon
Guest

Hillary wasnot quite frank with OV. She should have said: look, Victor, you are fairly green on this press thing. Take a cue from us. Never lead a frontal attack on the press: bypass it, outflank it. People need entertainment like Oprah, Larry King. Always obfuscate the issues. Take the ‘Occupy Wall Street’ movement. If we mention it at all in the media, it is only to dismiss it. Look at our newscasters on CNN: nice, young women, chatting about pleasant things in a pleasant way. That is what people need. (Ron: thanks for your comment)

Member

Jospeh Simon: THe problem with you SImon that you never meet a woman like Hillary. Why would you think she was chit chatting with OV? As far as I see it, it is the big macho Hungarian men who behave like OV’s lap dog (look at puppy Lazar, puppy Deutsch and Kover). They are running in circles and pee left an right, not knowing how to please their master, while letting Hungary roll toward an abyss. I think Hillary actually pulled a whoopass on this little punk, and he has no idea how to take that. People at Orban’s circle getting good enough money from Hungarian taxpayers to tell him to look for treatment, but they just do not do their job. Hillary’s job is not to do the job of the Hungarian government. What to do with the press? Didn’t Orban paid a whole load of money to an UK consultation firm to advise him? Why don’t you have a problem with that?

Member

@Joseph What do you mean by “we mention it” and “our newscasters”? Do you seriously think that the US government controls the media the same way as the Hungarian government? The US government “gives” Oprah to the people to distract ?? You should edit news for the MTI. They will love you.

Member

The fall in the Forint today seems to have been largely as a result of two things: Firstly, the IMF warning to Hungary; and secondly the failure of the Hungarian government bond auction.
If government bond auctions continue to fail and Viktor continues to “stand up” to the IMF, then the Hungarian government will not be borrowing any money to plug the hole in the budget. I wonder where the money is going to come from next?

Ron
Guest

David: I wonder where the money is going to come from next?
From the foreign currency reserves of the National Bank. The saving accounts, deposits and pensions of the people of Hungary. and finally the sale of the assets of Hungary, perhaps sale of the crown?

Ron
Guest

Today my mother in law informed us that one of her neighbors, who was a pro-Fidesz person until recently, is organizing a trip abroad for the sole purpose to open a bank account. After which they will be able to transfer their savings abroad.

Member

A busload of old ladies with wads of cash? What’s the route?

Ron
Guest

Mutt Damon: Austria.
But they will not take money, only open a bank account.
Apparently, some banks in Burgenland (Austria) are specialized for Hungarians bringing their money abroad.

Eva S. Balogh
Guest

About the flight of money from Hungary. I talked about Lázár’s newest about banks paying for municipalities’ bad loans. I first learned about this latest scheme from Népszabadság. The title was of the article: “Lázár ultimátuma az Erstének, ma vegyen eurót, aki tud!” For those who don’t know Hungarian: “Lázár’s ultimatum to Erste, anyone who is able should buy euro today!”

Paul
Guest

I’d have our savings in Euros tomorrow if I could. Unfortunately we have to be physically there to do it.
I can’t see why anyone would keep their money in Forint at the moment – or in any bank OV can get hold of.
I’m trying to see if we can get my mother-in-law to withdraw the money and buy Stirling – or Euros. But I don’t think we can even do that. I’m so used to internet banking that this is driving me nuts.

Ron
Guest

Paul: You can have somebody to withdraw money from your bank account.
However, each bank may have different rules and forms.
In the old days I signed the withdraw form (arranged by mail) and received standard proxy form from the bank which I had to fill out and to notarized it.
The person had to go to the bank with the withdraw form, proxy and his/her passport.

Paul
Guest

I hope you’re right, Ron. I guess half a million isn’t a lot to many people, but it is (was) all we had left from my redundancy, so it’s personal as well as financial.

Ron
Guest

Paul: My suggestion is to call the bank. Use Skype or VOIP as it is much cheaper, and ask for their procedure, after which you can start to withdraw.
I do not know your situation. but another way is to transfer the money from your deposit to your bank account.
That is just a transfer form, and you can do this by (normal)mail. Once the money is on your bank account via e-banking transfer it out. Use SEPA transaction as it is much cheaper.

Member
Laser (*) Janos’ letter to the Erste bank is such a beautiful example of the mindless arrogance typical of the Orban team. Laser’s argument is basically saying the borrowers are vulnerable when dealing with banks because they have to fully accept the conditions set by the lender. In other words the lender and the borrower are not equal partners because the borrower cannot force an agreement onto the lender to mitigate the possible losses for example. Come again? The bank should absorb all the losses because ….. ummm …. you want to keep your money. Aha. Got it! We were the country of 3 million beggars in the 30s now we will be the country of 3 million thieves. I think we should buy 1000 lottery tickets today and sue the state lottery agency next week because we didn’t win enough. We were unjustly forced into a deal to accept if we don’t hit he jackpot. Swindle! They should have setup a bail-out fund to help distressed homeowners only and the the eligibility should have been strictly based on income and assets. Of course this would exclude the MPs and would not buy enough votes. At least they think this… Read more »
enuff
Guest

Re: “people are not interested in politics.”
– politics are dividing families..
Mother-in-law chatting with Brother-in-law about current issues, BIL blamed the previous govn. for allowing people to borrow money beyond their means, which my MIL replied, well they didn’t point a gun at you!
heck, me and husband are on the same side even then we disagreed, my tone (as a foreigner) is as yours “in that case they deserve what they get,”
secondly, people like my BIL was more interested in raising money to pay-off his loan by the year end then to care about what’s going on in the govn.!
As I read others comments on withdrawing from HU banks, I’m starting to panic.

Vilmos
Guest
I don’t think personal savings accounts are in danger of confiscation (yet). For one thing, even Orban and company would be aware that that would probably be one action certain to awake the apathetic population. The foreign reserves “just sitting there” are far more likely to be used to keep this sinking ship afloat a bit longer. Of course, then the real danger to Hungarian savings accounts will be the forint’s further weakening/total collapse, and the higher prices we will have to pay, which itself is made more painful with the higher sales tax. We might be looking forward to more “crisis” taxes affecting more than just a few foreign-owned companies. Maybe confiscation of assets of MSZP-connected people as these assets are considered the product of corruption (and probably are in many cases). I’m sure you are all aware of the expression “the shit is going to hit the fan”. Over the past year, the pile of shit is getting higher, the fan is periodically replaced with a larger, more powerful model, and we wait with bated breath for the moment when the switch is turned on. Everything seems to be on hold in this between-holidays lull, but January will… Read more »
Eva S. Balogh
Guest

David: “If government bond auctions continue to fail and Viktor continues to “stand up” to the IMF, then the Hungarian government will not be borrowing any money to plug the hole in the budget. I wonder where the money is going to come from next?”
The forint is falling. It is over 311.5 to 1 euro.

Guest

London Blah!
Goodness! Eva! – I didn’t realise how neanderthal the male Hungarian politician is! I certainly didn’t pick up fully the nuance of what you wrote. Thanks for putting my hat on straight!
I am a bit suspicious of ‘football clans’ like Orban and those around him – they are tribal in the extreme – and I have found that the are never the sharpest knives in the drawer! I try desperately to avoid the social gatherings of such colleagues at work – they are just so insensitive and boring!
(I myself don’t have a low enough IQ to be interested in football. Ouch!)
Charlie

Paul
Guest

Well, at least you called it football, and not soccer!
I wonder how Americans would feel if we called their national sport by its English name – ’rounders’?!

Odin's Lost Eye
Guest
All of us can say what we like about the Viktator, but in his mind he has won a resounding victory at the polls and he believes that the ‘winner takes all’. He is taking it! He sees this land being ruled by a ‘Plutocracy’ who will support him in doing what he wants. He knows vaguely that there are ‘things’ beyond Hungary, he is aware of them and what they mean, but he like the captain in my story who was ‘God on his ship’ he has forgotten that there things beyond his ship over which he has no control and which he must take notice of. So far he has avoided direct conflict with those who live in the dark places beyond Hungary but at midnight tonight CET he and his country are breaking European law. But he won the elections and to his mind the winner takes all. He is Hungary. He spent a term or two at Pembroke Collage in Oxford, reading law. I knew someone there, a night porter (from the Latin ‘portus’ a door). How can common ‘Oiks’ hold power over the learned ones. A greeting, a smile, your messages Professor, oh yes Dr… Read more »
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