Tag Archives: autocracy

Vulnerable Democracies — An interview with János Kornai

János Kornai, professor emeritus at Harvard and Corvinus, is the foremost economist in Hungary today. Several of his books have been translated into English, including a book that made him a maverick in the tightly centralized planned economy of the 1950s titled Overcentralization in Economic Administration (Oxford University Press, 1959). He is also the author of Anti-Equilibrium (Amsterdam: North Holland, 1971; 2d ed., 1975 in English); Rush versus Harmonic Growth (Amsterdam: North Holland, 1972); Growth, Shortage and Efficiency (Oxford: Basil Blackwell and Los Angeles: University of California Press, 1982); Road to a Free Economy. Shifting from a Socialist System: The Example of Hungary (New York: W. W. Norton, 1990); Vision and Reality, Market and State: New Studies on the Socialist Economy and Society (New York: Routledge, 1990); The Socialist System. The Political Economy of Communism (Princeton: Princeton University Press and Oxford: Oxford University Press, 1992);  and By Force of Thought. Irregular Memoirs of an Intellectual Journey (Cambridge-London, The MIT Press, 2007), his autobiography. Professor Kornai has been awarded honorary doctorates from dozens of prestigious universities.

The online version of the interview that follows appeared in two installments in HVG on December 28 and 29. The first bears the title “Immovable powers, autocracies and their Hungarian variation.” The title of the second is “There is no way Viktor Orbán’s government can be removed peacefully.”

This interview, conducted by Zoltán Farkas, originally appeared in the print edition of Heti Világgazdaság, vol. 2016/41 (October 13), pp. 10-13. In the online version only Zoltán Farkas’s questions and János Kornai’s answers are presented. The Hungarian original also includes a map and a summary of the central ideas. The latter are not presented here as both are available in the longer paper “The System Paradigm Revisited” in Acta Oeconomica vol. 4, (2016). The interview was translated by Dóra Kalotai and Christopher Ryan. Zoltán Farkas and János Kornai are indebted to them for their careful translation.

Hungarian Spectrum has had the privilege of publishing a number of János Kornai’s shorter works in English, either in full or in summary form. For example, his essay on “Centralization and the Capitalist Market Economy,” “Threatening Dangers,” “Hungary’s U-turn,” and “Breaking Promises, The Hungarian Experience.” I’m grateful to Professor Kornai for permission to publish this interview.

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Source: HVG / Photo by István Fazekas

It was six years ago when you first wrote that many important basic institutions of democracy in Hungary had been dismantled, and Hungary had become an autocracy. Now, in a study recently published in Közgazdasági Szemle, you have already summarized the characteristics of autocracies. Has your previous premonition been proved correct?

I feel I have been proved completely correct. Usually, a researcher is filled with pride when he is among the first to recognize a tendency. My pride, however, is overshadowed by bitterness, because the fact that my predictions have come true makes me depressed and bitter.

But Hungary is not unique in this sense. You write that barely one-tenth of the population of the 47 post-socialist countries live in democracies and fifteen percent in autocracies, while the vast majority live in dictatorships. It’s almost as if democracy was the exception. Were we chasing illusions at the time when the regimes changed?

If we start from the knowledge that we possessed at the time of the regime change, based on the experience of democratization carried out in other countries, our hopes for a more successful development – compared to what actually happened – were not just an illusion. It is worth taking a look at the two largest countries, China and Russia. In the latter the elements of democracy were beginning to emerge, free elections were held, and under the leadership of Yegor Gaidar a liberally inclined government was formed. But it did not last long. Anti-democratic elements came to the fore, led by Vladimir Putin, who established his own autocratic system. Repression grew heavier and heavier. China is another story. Perhaps for a while it was not only an illusion that it was, even if slowly, making progress towards democracy. The example of Taiwan is well-known: a tough dictatorial system gradually turning into a democracy. But in China events did not take this turn. How a regime defines itself is always revealing; according to the Chinese regime, theirs is “a socialist market economy with Chinese characteristics.” In my interpretation, on the other hand, China’s system is a capitalist one, even if the ruling party calls itself communist. And politically they have a dictatorship: a one-party system, without elections, with terror. Among countries that changed their regime, democracy has stabilized in very few places as well as it has in the Baltic states. Since 2010,  many fundamental institutions of democracy have been demolished in Hungary, and an autocratic regime has come out on top. Poland has taken the first steps in the same direction, but that particular match has not yet been played out. The abandonment of democracy is a threat in the other post-socialist countries of Central and South-eastern Europe as well.

Which are the characteristic features of autocracy, the marks that set it apart?

Before anything else, I have to say that there is no consensus on the interpretation of democracy, autocracy or dictatorship among political scientists, politicians and people working in the media. There is complete conceptual chaos; I can’t even begin to hope things can be put in order here. Thus I shall undertake a more modest task: I would like to supply my readers with a sort of explanatory glossary of what I mean by these expressions. The main distinguishing characteristic of autocracy can be linked to Joseph Schumpeter, one of the most significant thinkers of the 20th century. Many authors, among them Samuel Huntington, follow his lead in viewing democracy as a procedure: a course of actions in which the government can be removed in a civilized way: legally, without bloodshed. This is in contrast with non-democracies, in which the change does not take place in a civilized fashion, nor does it usually happen without blood being shed. For instance, the tyrant is assassinated, or his regime is overthrown by a palace revolution. An example of the latter case was when the First Secretary of the Soviet Communist Party, Nikita Khrushchev was removed from power by his opponents within the Party. In other places the change of regime happens in the wake of a military coup or when a revolution by the masses threatens. If the government cannot be removed or is, to use an everyday phrase, cemented in place, there is autocracy. Schumpeter and others following him, myself included, restrict the name democracy to that politico-governmental form, and only that form, which guarantees that the government can be voted out of office. This is the minimum requirement. The other point is that in an autocracy the ruling group dismantles those checks and balances which would offer a realistic chance of forcing the government to correct its mistaken measures between two elections, and of changing the government at elections.

Fareed Zakaria defined as ‘illiberal democracies’ those systems in which the government came to power via legal elections, and has maintained the outward forms of democracy, but has systematically dismantled the checks and balances. You maintain that there are no illiberal democracies. Why?

When he first wrote about the topic Zakaria did not concentrate on the possibility of voting out the government, but rather on how the majority voted during the election, and on how the winners would uphold certain democratic structures later on, but dismantle others. When the Hungarian prime minister introduced the concept of illiberal democracy into public discourse at Tusnádfürdő, Zakaria, disagreeing with Orbán’s interpretation, refined the explanation of the notion. Personally, I consider this concept a dead end: illiberal democracy is like an atheist pope: the adjectival structure itself is contradictory. In my view all democracies are liberal. I lost my taste for concepts of democracy with an adjective when the communist dictatorship referred to itself as a ‘people’s democracy’, clearly distinguishing itself from the so-called ‘bourgeois’ democracies. But let us return to the significance of checks and balances. Let’s consider the case of President Nixon in the United States, who felt inclined to ‘consolidate’ his position, and had his political rivals bugged, but after being exposed was unable to get his Republican party colleagues, the attorney general or the chairman of the House Judiciary Committee to stop the proceedings against him. The representatives were not bound to a ‘party line’: they wanted to find out the truth – the checks and balances functioned. These are necessary in a democracy. Just like a free press, in which the voice of the opposition is at least as powerful as that of the government. At the same time, it is also true that democracy is vulnerable because the enemies of democracy can also make use of fundamental rights – the freedom of the press, the rights of assembly and association. Those who have built an autocratic order have learned from this. They do not allow themselves the luxury of being voted out at an election where there is the real possibility of a variety of outcomes.

But if this is so, why is it not a dictatorship?

Dictatorships and autocracies do share some common features. One is that in every important issue; indeed, often even in less significant matters, it is the leader who makes decisions. But there are also significant differences. A dictatorship abolishes the multi-party system by law as well. The opposition is not weak; it is non-existent. It is driven underground. In contrast, opposition forces are allowed to function in an autocracy. Autocracies also make use of intimidation, but they do not go as far as extracting confessions by torture or executing large numbers of people. Many people have good reason to be afraid in autocracies as well because they may be thrown out of their jobs or become victims of character assassination; maybe they will be arrested on trumped up charges. But anybody who believes that there is only a difference of degree between autocracy and dictatorship has not yet lived under a dictatorship. Having said this, autocracies do have a tendency to turn into dictatorships. Maybe modern Turkey will illustrate this, almost before our very eyes. We shall see whether they reach the stage of complete, total dictatorship.

You did not list nationalism as one of the characteristics of autocracy. In Hungary, however, one has the impression that they go hand in hand.

I tried to mention only those characteristics of autocracy that appear exclusively in this political-governmental structure; that is, the features which differentiate it from democracy and dictatorship. An obvious counter-example would be corruption, which can be observed in all three types. Innumerable cases of corruption crop up in certain democracies, while there are puritan dictatorships in which money cannot buy everything. Unfortunately, nationalism is another anomalous phenomenon: democracy does not make us immune to it. One of the most tragic examples of this is the period of World War I, when a wave of nationalism swept through both sides; through both of the coalitions that were to go to war against each other. It was a nationalist thirst for revenge that was at work in the politicians of Western European democracies when they imposed humiliating and impossible peace terms on Germany. In this context, to take a great leap through history, the Trump phenomenon is worth mentioning. One of the great parties of the United States nominates the extreme nationalist Trump for the presidency. Even if he does not win the elections, the political camp that supports him will remain strong, and because the United States is a democracy, they will make their voices heard. Recently, a strong wave of nationalism has been felt in Great Britain as well.

What is your impression of Hungarian nationalism?

I am really worried about it getting stronger, not for myself, but for the future of the country. Because I do not deny that in Hungary autocracy and nationalism go hand in hand. An autocrat is indeed able to turn the wave of nationalism to his own advantage; Trump is doing the same. The main element of his rhetoric is xenophobia, especially against Latin Americans. He adds that the gates are too wide open also to immigrants from overseas, and rejects President Obama’s suggestion that ten thousand Syrian refugees should be allowed to the country. By the way, communist dictatorships that advocated internationalist theories were nationalistic as well. Non-Russian minorities were oppressed in the Soviet Union, and the same can be said of non-Chinese ethnic groups and speakers in China. Nationalism exists in both dictatorships and democracies, not only in autocracies.

In this conceptual framework why do you define Viktor Orbán’s system as an autocracy?

Because it bears in itself all the important characteristics of autocracy, both its primary and its secondary features. This period started with the leader announcing that he intended to establish a system which would last for at least ten or twenty years. He declared that he wanted to cement himself in place. Since the day he came to power, he and his party have been continuously dismantling the system of checks and balances. Not like in a revolution, when they take over every powerful position at the same time, but step by step. Every week, something has happened. One of the first things they did was to reduce the Constitutional Court’s sphere of authority and pack the Court with people connected to Fidesz. Then came the new media law, which created almost endless opportunities for government propaganda. They also took over a significant part of the private media. The bureaucratic dismantling of checks and balances is combined with the use of market methods. The process culminated in the changing of the law on elections.

You write that the interplay of anti-market and anti-democratic elements has formed Orbán Viktor’s system into a coherent one; the mechanism of the state does not work according to the rules of the capitalist market economy. So how does it work?

Even in democracies it is taken for granted that the market cannot be left entirely to its own devices: there is not a single economist with any common sense who would oppose some regulation here and there when there is a real reason for it. In cases of monopoly, state regulation is clearly necessary. Even then, mistakes can be made. For example, the authorities may set prices too high or too low because they don’t understand the situation or are incompetent. Too high, and whoever is running the monopoly will make a handsome profit; too low, and they will make a loss. It is possible for regulation to be done badly as a result of incompetence, but it can also happen if other people’s interests, for example. cronies’, are prioritized. A business can be ruined through regulation so that a friend or client can buy it up cheaply. The tendency towards regulation that is not compatible with the functioning of the market is one of the characteristics of an autocracy. The Hungarian government exercises far more regulatory power than would be reasonable. There are numerous possible underlying motives for their unnecessary, excessive and – not infrequently – distinctly damaging interventions. On the one hand, the central authorities wish to extend their power across as many activities as possible. The knowledge that “I control everything: nothing can happen without me” is a very powerful motivation. An equally strong motive is the need to court political popularity, to make populist promises.

What are the results when autocracy works this way?

It is a mistake to believe that there are so many things wrong with the economy, that because of the numerous incompetent and biased interventions it functions so erratically, that it is bound to collapse in the end. This may happen, but it is by no means bound to happen. A state that gets along badly with the market does not push the economy over the edge into catastrophe; it just makes it harder for it to fulfill its potential. It will not be innovative enough, not competitive enough; it will lose the best experts. This will become obvious only in the long run. The trams still run, only more rarely, the teachers complain, but teaching doesn’t stop, health care is beset by dire problems, but they still try to look after patients in hospitals. It is not that the economy is unable to function, only that it fails to achieve as much as it could. As a result, it falls behind its rivals, behind those countries where the state and the market work together in greater harmony, where people involved in the economy discuss what they have to do, where they listen to people before passing laws that affect them. In the past, I had many arguments with people who claimed that the Soviet economy did not work. The truth is that it did not collapse until the very end: it functioned, however badly and inefficiently, in spite of all the well-known, serious inadequacies and problems. It fell further and further behind its historic rival, the capitalist West. The question arises: does the state play a lesser role in a democracy than in an autocracy? At any rate, it would never occur to anybody in the U.S. or the Scandinavian welfare states that education should be brought under the control of a single center, as has happened in the Hungarian autocracy.

Every day we hear Fidesz trotting out some of the well-known catchwords of socialism. They promise full employment, they consider state ownership superior; they utter anti- profit slogans. Are they leading the country back to socialism? Is that what they want to restore? Even in a different form?

I do not see any danger of this. At the time of the regime change, people used to say “You can make an omelet out of an egg, but an omelet will never turn back into an egg.” Whatever happened is irreversible. Autocrats coexist happily with capitalism. Indeed, it is the only system they can really coexist with because they make use of the opportunities offered by capitalism to maintain their own authority. Looking at it from the other side, some capitalists are attracted to stable and authoritarian governments. Many western or multinational companies that have set up shop in China would not like the situation there to change. It is just the same in Hungary. Anybody who enjoys special advantages in public procurements and certain tenders, in the opening times of shops or the purchase of raw materials, who can count in bailouts if they get into financial difficulties, they are having a good time. In autocracies, given the private economy, a wide circle of clients can be built up from the supporters of the system who receive financial support. They can pay for these favors if and when the time comes. Far from wishing to bring socialism back, this regime gets on very well indeed with capitalism.

Has this system reached a point where the government can no longer be voted out of power?

Only the historians of the future will be able to answer that question. If it turns out that the government can be removed peacefully, in a civilized way, in the voting booth, then I have been wrong. I’m not making any predictions. What I can say is this: in Hungary, the regime has done and will continue to do everything possible to make itself irremovable. I hope you will not misunderstand me: the last thing I want to do with my analyses is to discourage those who are prepared to fight to change the situation. People for whom the values of democracy are important: individual autonomy, freedom of speech, freedom of the media and press, constitutionalism, legality, rule of law–they should not make their behavior dependent on the likelihood of change. They should not lie low during these years, but they should act, in their own ways, using the methods of their choice.

December 29, 2016

Jean-Claude Juncker: “The dictator is coming”

More than a million people have looked at the YouTube clip of the by now infamous scene where Jean-Claude Juncker, president of the European Commission, greets Viktor Orbán with “The dictator is coming” and raises his right hand in a quasi-Nazi salute. The news spread like wildfire. I found well over fifty articles in the Hungarian media describing this 26-second video. I’ve seen an unusually large number of references to it in American papers, in addition to the usual German and Austrian avalanche of Hungarian news items. Those commentators who are critical of the Orbán government found it hilarious, while the two pro-government organs, Napi Gazdaság and Magyar Hírlap, decided to remain quiet on the subject. Orbán’s press secretary explained that there is nothing new in this exchange. Juncker always greets Orbán this way and, in return, Orbán calls Juncker Grand Duke. How jolly.

A commentator from the right Dávid Lakner didn’t find the scene at all funny. Instead, it struck him as embarrassing, especially at a time that more and more people view the European Union itself as a joke. Lakner called Juncker “an imprudent clown.” He suspects that the president was inebriated. (Juncker has been accused of heavy drinking by some of his critics.) On the other hand, journalists of Luxembourger Wort, who ought to know Juncker very well, were not not shocked, nor did they accuse him of drunkenness. They simply noted that “Juncker lived up to his reputation for straight talking … when he hailed Hungarian Premier Viktor Orbán as ‘dictator’ on his arrival at an EU summit in Riga.”

I have also have objections to Juncker’s joking mood, but on very different grounds from Lakner’s. Hungary’s sinking into a one-man dictatorship is no laughing matter. It is not a joke. It is a deadly serious business. Merriment over what Orbán is doing in Hungary is an inappropriate reaction from the president of the European Union.

And this brings me to an op/ed piece by Sergei Guriev and Daniel Treisman in yesterday’s New York Times titled “The New Dictators Rule By Velvet Fist.” Their short article is based on an earlier longer study, “How Modern Dictators Survive,” prepared for the Centre of Economic Policy Research in London. Their argument is that modern dictatorship no longer needs to have totalitarian systems and tyrants like Stalin, Hitler or Mao. Instead, “in recent decades, a new brand of authoritarian government has evolved that is better adapted to an era of global media, economic interdependence and information technology.” These new dictators achieve a high level of control over society by stifling opposition and eliminating checks and balances–and they achieve this without any violence at all.

Among “these illiberal leaders” we find Viktor Orbán alongside of Alberto K. Fujimori of Peru, Vladimir Putin of Russia, Recep Tayyip Erdoğan of Turkey, Mahatir Mohamad of Malasyia, and Hugo Chávez of Venezuela. What illustrious company! But at least the others are not being financed by European democracies the way Viktor Orbán’s dictatorship is being subsidized by the EU. I wonder how the taxpayers of Western European countries would feel if they fully realized to what end Viktor Orbán is using their hard-earned money. I doubt that they would find it a joking matter.

According to Guriev and Treisman, “the West needs to address its own role in enabling these autocrats.” This is certainly true about the European Union vis-à-vis Hungary. But the authors also talk about lobbying efforts on behalf of these dictators. We know from earlier posts what an incredible amount of money is being spent by the Orbán government on foreign propaganda just in the United States. The four-year contract Connie Mack and Századvég signed was for $5 million.

The authors suggest, and I fully agree with them, that “lobbying for dictators should be considered a serious breach of business ethics.” Although Representative Dana Rohrabacher, speaking to Kriszta Bombera of ATV, denied that he was coached by the Hungarian government through Connie Mack and said that holding the hearing was his own idea, the director of Századvég made no secret of Connie Mack’s usefulness as a top lobbyist in Washington in getting a hearing on U.S.-Hungarian relations during which the chairman and his Republican colleagues defended the Orbán government with full force. “It was a breakthrough,” said Kristóf Szalay-Bobrovniczky of Századvég.

And finally, let me talk about other enablers, specifically the two Hungarian-American associations whose leaders claim that for years they have been tirelessly promoting better understanding between the two countries. They are the Hungarian American Coalition and the American Hungarian Federation. Although they claim to be politically neutral, in fact they are conservative lobbying groups which support right-wing Hungarian governments. I know from personal experience that the Coalition at least moves into high gear only when a right-wing government is in power. After Fidesz lost the election in 2002, the Coalition paid for a group of Fidesz members of parliament to spend two or three weeks in Washington to learn something about American democracy. When I asked why only Fidesz politicians were invited, I was told that the socialists were simply not interested in spending time in Washington. I found the explanation improbable. So I wrote to Ildikó Lendvai, who was the whip of the socialist parliamentary delegation at the time, and it turned out that the socialists had never received any such invitation. That should give you some sense of the true nature of these organizations.

I was therefore somewhat surprised when I heard that the presidents of these two organizations decided not to attend Rohrabacher’s hearing. I thought that perhaps they realized that something was very wrong in Orbán’s Hungary. Perhaps they decided that they would no longer stand by the Hungarian dictator with a velvet fist. I was hoping that the statement Maximilian Teleki, president of the Coalition, released on May 22 would explain his reasons for not participating in the hearing. Instead, we learned only about the dangers of Jobbik and the great achievements of the Orbán government, which in 2010 “faced a Greece-like economic and financial crisis” and which by now has achieved “a respectable economic growth.” As for Jobbik’s anti-Roma and anti-Semitic propaganda, the only thing Teleki could say is that “the Hungarian government has taken a zero-tolerance policy,” adding that much still remains to be done.

Maximilian Teleki with April H. Foley, former U.S. ambassador to Hungary ad a great supporter of Viktor Orbán

Maximilian Teleki with April H. Foley, former U.S. ambassador to Hungary and a great supporter of Viktor Orbán

In his opinion, the United States “has done little to assist Hungary in developing a long-term [energy] strategy and implementing an effective action plan.” He mentioned “Russia’s aim of reestablishing Cold War-era borders and spheres of influence in the region” but had nothing to say about the close Russian-Hungarian relations and Paks II. What should the United States do to improve the “bilateral relationship” between the two countries? The U.S. should offer more opportunities for Hungarian decision makers to visit the United States; more U.S. officials and decision-makers should obtain first-hand experience by visiting Hungary frequently; and the U.S. should “make possible meetings at the highest political levels: it has been more than 10 years since Hungary’s Prime Minister was received in the White House.” And yes, the United State should support educational and cultural programs sponsored by NGOs. In brief, the dictator with a velvet fist should be rewarded for degrading Hungarian democracy into a modern-style dictatorship.

Fidesz versus Jobbik: Not much difference

Few things can annoy me more than reading in the foreign press or in political analyses that the Orbán government is “conservative.” Take, for instance, the otherwise admirable report prepared by the Congressional Research Service for the hearing organized by the House Subcommittee on Europe, Eurasia, and Emerging Threats. It refers to the Hungarian government, Fidesz, as conservative and calls Jobbik a “relatively new, far-right ultranationalist party.” Unfortunately, both descriptions miss the mark–the latter by a little, the former by a lot.

The word “conservative” has many meanings, but all of them stress that the aim of a conservative, be it an individual or a party, is to preserve established customs and values. Even without knowing anything about the recent history of Fidesz and the Orbán government, one ought to remember the speech of Viktor Orbán, made after the party’s stunning victory in 2010, in which he claimed that what happened was a “revolution.” Surely, revolution and conservatism are not bedfellows. And if the victory was a revolution in the voting booths, what has happened since has been a constitutional and administrative revolution, turning the whole constitutional setup and state administration topsy-turvy and transforming Hungarian democracy into a full-blown autocracy, Putin-style. It is time to recognize that Fidesz is a far-right party which has nothing whatsoever to do with conservatism.

By the same token, Jobbik is not just a “far-right ultranationalist party,” as the Congressional Research Service claims, but a racist one as well. Otherwise, Fidesz and Jobbik are pretty much ideological twins. Foreign observers often compare Jobbik to France’s National Front, which is a mistake. Fidesz is the National Front of Hungary. Here I will attempt to show that by now the programs and ideology of the two parties are practically indistinguishable.

Sharper observers, for example Paul Lendvai, noted already in 2012 that the only difference between Fidesz and Jobbik is “the volume and the sharpness of the text. Fundamentally they think similarly about the tragic events of Hungarian history” and the desired future for Hungary. By now, more and more analysts share Lendvai’s assessment, mostly because in the last six years, little by little, Viktor Orbán has carried out practically the entire Jobbik program of 2010. Jobbik didn’t have to be in power to realize its program. Fidesz was good enough to oblige.

Jobbik kormany “In the name of the people” they proposed ten measures that would constitute their first tasks once in power. Since then, Fidesz has fulfilled eight out of the ten. A good list of Jobbik demands and Fidesz responses to these demands can be found in Policy Solutions’ analysis of the Hungarian far right. Jobbik promised to lower taxes, to save the Forex debtors, to nationalize utility companies and thus decrease utility costs, to tax the multinational companies, to lower the pensions of former communist cadres, to introduce public works instead of financial assistance, to prevent foreign ownership of land, and to give citizenship to Hungarians living in the neighboring countries. Doesn’t that sound awfully familiar? Fidesz obliged. Only two demands haven’t been met: the repeal of the right of immunity for members of parliament and the establishment of a gendarmerie. Both are small potatoes.

But that’s not all. It was Jobbik that demanded the discontinuation of private pension plans and the incorporation of their assets into the state social security fund. Fidesz promptly “stole” the private savings of about 3.5 million people. Jobbik demanded the mention of Hungary’s Christian roots in the new constitution. It was done. Jobbik called for the removal of Mihály Károlyi’s statue from its place in front of the parliament. Achieved. Jobbik demanded the removal of Franklin D. Roosevelt’s name from the square in front of the Hungarian Academy of Sciences. The president of the Academy got the dirty job of carrying out this task. Jobbik wanted to declare June 4, the day the Treaty  of Trianon was signed, a “national memorial day.” Done. Jobbik considered the earlier government’s “servile attitude toward” the EU unacceptable and “was ready to confront Brussels, if necessary, on some national issues.” The last six years of the Orbán government have been spent in constant confrontation with the European Union. It’s time to wake up. As a blogger said the other day, “It has been Gábor Vona [of Jobbik] who has been governing Hungary” for the last six years.

Back in November 2009 I was asked to give a short talk on the Hungarian far right. In my speech I argued that the difference between Jobbik and Fidesz was minimal. I said: “In general, there are just too many signs that the messages of Jobbik and Fidesz are not radically different from one another. It is also becoming increasingly clear that supporters of the two parties overlap. It seems to me that on most fronts Fidesz says the same things as Jobbik but in a slightly more civilized manner.” If that was true then, as I believe it was, it is ten times more true today. Moreover, since Vona decided to adopt a less radical tone in the hope of gaining greater voter acceptance for Jobbik, even what Paul Lendvai called “the volume and the sharpness of the text” has more or less disappeared between the two parties. Vona lowered his voice, Orbán turned up the volume.

There is the misconception, often expressed in opinion pieces in the German, French, and American media, that any criticism of Viktor Orbán’s policies is dangerous because it is Fidesz that is the bulwark against the spread of the neo-Nazi party. I understand that Fidesz propaganda would like us to believe that they are the ones who will defend us from the horrors of a racist, extremist, ultra-nationalist party forming a government in the heart of the European Union. But the history of Fidesz and the Orbán government in the last six years has demonstrated that these two parties see eye to eye on almost everything–from history to the European Union to foreign capital. Viktor Orbán never once tried to stand up against rising extremism or what Jobbik stands for. No, as a matter of fact, he constantly stokes the fire with his intemperate speeches. To expect this man to save Hungary from Jobbik’s extremism is the greatest folly I can think of.

Orbán buries democracy with faint praise

After Viktor Orbán delivered his speech at the Friends of Hungary Foundation on Saturday, I received two e-mails calling my attention to it. One of them included a commentary on the speech by Zoltán Bodnár, former CEO of the Hungarian Export-Import Bank and earlier a deputy chairman of the Hungarian National Bank. Lately, Bodnár can often be seen on TV as the adviser to Gábor Fodor’s liberal party on economic matters.

Bodnár called Orbán’s speech a milestone, akin to his speech in Romania last summer about illiberal democracy. “Any of you who still have doubts about what kind of a society Orbán wants … should listen to this speech.” I searched for newspaper accounts of the event but was disappointed. I couldn’t find any earthshaking revelations in the summaries of Orbán’s speech. Bodnár must be exaggerating, I thought.

Today I know what the problem was. The summary that appeared in scores of Hungarian newspapers was prepared by MTI, the official Hungarian news agency, whose management has a keen sense of what should be left out of their reports. Anything that would create an outcry both at home and abroad must be ignored. And Bodnár was right. Those missing lines would have created an uproar if they had been widely reported.

First, I will look at the speech as it appeared on Orbán’s website. I will concentrate on those sections that were left out of the MTI summary and will also point to the prime minister’s creative use of quotation marks. Second, I will call attention to some very important sentences that were uttered during the question and answer period but were not transcribed for the prime minister’s official website.

What is it that Bodnár and others found more objectionable and more telling than Viktor Orbán’s words about “illiberal democracy”?

Democracy versus autocracy

The main theme of the speech was the necessity of breaking through political taboos that prevent us from finding the right answers to real questions. Instead of listening to our instincts, “we escape to a world of voodoo and taboo away from our own questions, the questions of our own lives.” According to the Hungarian prime minister, Europe is spending its energies on sterile debates about ideology and political systems instead of trying to find answers to such important questions as “how it is possible that while Europeans–including ourselves–value democracy over non-democratic arrangements, the latter are more successful today? Will democracy in the decades ahead–as we would like to believe–be capable of providing good political leadership?” While last summer Orbán simply talked about illiberal democracies, by now he got to the point of doubting that democracy can be a viable instrument of political leadership. While allegedly valuing democracy, he testified to the superiority and even desirability of autocracy over democracy.

Viktor Orbán in his element during the question and answer period

Viktor Orbán in his element during the question and answer period

Orbán elaborated on this theme: “The European politician is inclined to suppose that the question of political arrangement is of the utmost importance because, if it is solved, the problems of reality are automatically taken care of.” I think this sentence needs a “translation.” In my interpretation, what Orbán means here is that European politicians believe that democracy is the foundation of a healthy society and economic system, but in his opinion that is not the case. Democracy itself doesn’t solve problems, and solving problems doesn’t require a democratic system.

These were the main points that were cunningly left out of the MTI summary that circulated in the Hungarian media.

While I’m still on the main body of the speech, I’d like to point out at least one instance in which Orbán falsified his source. Orbán wanted to prove that small nations actually have an advantage over large ones in this uncertain world and that therefore “Hungary has a real chance to show new ways, new means, and methods for the benefit of the whole world.” What is the supporting evidence for this contention? Klaus Schwab, founder of the World Economic Forum, wrote an article a couple of months ago titled “Are You Ready for the Technological Revolution?” In it Schwab claims that “the defining features of [the new post-post crisis world] is the rapid pace of technological change. It is so fast that people are even referring to it as a technological revolution. This revolution is unlike any previous one in history, and it will affect us all in ways we cannot even begin to imagine…. In this new world, it is not the big fish which eats the small fish, it’s the fast fish which eats the slow fish.” The message is that countries, regardless of their size, will be successful as long as they respond quickly to technological challenges.

Orbán the technophobe took liberties both with Schwab’s text and with the very notion of citation. He attributed the following sentences to Schwab, putting them inside quotation marks: “The era has ended in which a big fish eats the small one. From here on the fast fish will rule while the slow ones will be destroyed. In this new world nothing will be taboo, we must study and re-evaluate all practices.

“No” to an intellectual direction that is considered progressive 

Finally, let me translate a passage that can be heard on a five-minute video in which the key sentences from the speech were collected. The most valuable part of the video is the one- or one-and-a-half-minute segment from the question and answer period. From Orbán’s answer it seems that someone from the audience must have said something about the “bad communication” of the government as the reason for Hungary’s unsavory reputation abroad. Orbán corrected him. Yes, communication could have been better, but this is not the only reason for the West’s dislike of his government. Here is the relevant text:

There is an intellectual debate in Europe about which way the Continent should be heading. What its mission is. In my opinion we are on the right side of this debate, but it is not a popular one. Today those are in the majority who think that Europe should move toward the fulfillment of individual rights, and that means three things. For example, it would help our individual freedom if we could get rid of our sexual identity. They think it would further the cause of freedom if we could get rid of our national identity. They think that we would be better off if we could rid ourselves of those ideas that stem from being God’s creatures. In this case we could make decisions more freely about life’s questions. But we don’t agree. It is better if we openly admit that. In our opinion, man will not be freer if he removes the barriers imposed on him by being a created entity. [Applause] In our opinion we don’t have to get rid of our sexual identity, our national identity. Here we cannot make concessions even if our reputation suffers. In these questions we can’t lie. The truth is that we don’t agree with the intellectual direction that considers itself progressive.

At least Orbán is honest here, which is something. It doesn’t happen too often. My other correspondent, who shared his reaction with me and many others, wrote: “I’m in despair. What should we do? What can we do? Our leader went mad. I feel sick!”

In the one published reaction to the video I found these words: “It rarely happens that I have to search for words, but it has happened. I looked at, I listened to the mad speech of our leader, and even without a degree in medicine I can say: we are in big trouble.”

What can I add to that? Perhaps I should correct the blogger who thinks that something is wrong with Orbán’s mental state. No, I am convinced that he is perfectly sane and that he believes every word in this speech as well as in many others. They are all variations on the same theme, except the message gets stronger with the passage of time. I wonder when the day will come that the Hungarian people as well as the European Union decide that they have had enough.

János Kornai: Hungary’s U-turn

János Kornai, the renowned Hungarian economist, Professor of Economics Emeritus at Harvard University and Corvinus University of Budapest, has written a new paper about the situation in Hungary. He notes that the main direction of the changes up to 2010 was progress toward democracy, the rule of law, and a market economy based on the dominance of private ownership. Hungary is the first, and so far the only, member of the group of 15 post-socialist EU member countries to execute a sharp U-turn and set off resolutely in the opposite direction. The country has shifted from democracy to autocracy. The final version of this paper will be published in the October issue of Journal of Democracy. I’m grateful to Professor Kornai for allowing me to share this prepublication working paper with the readers of Hungarian Spectrum.

 * * *

 

 

Hungary’s U-Turn

János Kornai

 Prepublication working paper

January, 2015

Do not quote without the author’s permission

Hungary is a small country, poor in raw materials, with a population of only 10 million. No civil wars are being waged on its territory, nor is there any popular uprising or terrorism. It has not got involved in any wars, and it is not threatened by immediate bankruptcy. So why is it still worth paying attention to what is going on here? Because Hungary – a country that belongs to NATO and the European Union – is turning away from the great achievements of the 1989-1990 change of regime – democracy, rule of law, free-working civil society, pluralism in intellectual life -, and is attacking private property and the mechanisms of the free market before the eyes of the whole world; and it is doing all this in the shadow of increasing geopolitical tensions.

 

1

Let us consider the ensemble of the following countries: Albania, Bosnia-Herzegovina, Bulgaria, the Czech Republic, Estonia, Croatia, Poland, Latvia, Lithuania, Macedonia, Hungary, Romania, Serbia, Slovakia and Slovenia. All of these now independent countries reached a crucial turning point in 1989-1990. Previously, they had functioned as independent states or as separate parts of states within the socialist system, ruled by the Communist party. Then the change of system started. The structure and pace of the transformations varied from country to country. Severe failures occurred in all of them, including Hungary; one step forward was often followed by a period of regression. However, despite the colorful variations, the main direction of the changes was common up to 2010: progress towards market economy based on the dominance of the rule of law and of private ownership.

Hungary is the first, and so far the only, member of this group of 15 countries which has performed a sharp U-turn and set off resolutely in the opposite direction. At the 2010 elections the coalition formed by Fidesz – Hungarian Civic Alliance with the Christian Democratic People’s Party (henceforth Fidesz for short), led by Viktor Orbán, won a landslide victory. That was when the turn began.[1]

  1. By 2010 the fundamental institutions of democracy had been established in Hungary – however, with the U-turn their systematic destruction started. It has already been completed to a significant degree.

In actual practice the executive and legislative branches are no longer separate, as they are both controlled by the energetic and heavy hand of the political leader who has positioned himself at the very pinnacle of power: Viktor Orbán. No worthwhile preparatory work on bills is being done either within or outside the walls of Parliament.  Parliament itself has turned into a law factory, and the production line is sometimes made to operate at unbelievable speed: between 2010 and 2014 no less than 88 bills made it from being introduced to being voted on within a week; in 13 cases it all happened on the same or the following day. Without exception, every single attempted investigation of the background of a scandal that has just broken, which would have been carried out objectively by a parliamentary committee with the effective involvement of the opposition, has been thwarted. ‘Reliable’ people close to the centre of power occupy decision-making positions even in organizations which are not under the legal control of the executive branch and which, in real democracies, should serve as a counter-balance to monitor the executive and legislative branches: in the constitutional court, the state audit office, the fiscal council, the competition authority (the office in charge of enforcing pro-competition laws), the ombudsman’s office and the central statistical office, as well as the national tax and customs office.

  1. The basic institutions of the rule of law had emerged by 2010; however, since the U-turn they have been abolished or significantly weakened. The new Hungarian constitution was drafted by a small group within Fidesz, and no wide public discussion ensued. All protests were completely ignored, and it was dragged through the defective filters of the law factory in very short order. The text abounds with shortcomings, which were pointed out immediately (and in vain) by outstanding Hungarian and foreign legal experts. It contained so many clauses which served the immediate political purposes of the people in power that the document, officially called ’Fundamental Law’, has had to be amended five times. In 2011-2013 the Fundamental Law was complemented by the passing of 32 so-called ‘cardinal laws’, which future parliaments will be able to modify only by a two thirds majority. This collection of laws almost completely covers every aspect of the country’s life.

One of the fundamental principles of the rule of law is that no-one, not even those who hold the most power, should be above the law. The law must be respected. In Hungary, the situation has changed: the holders of power are able to elevate any decision to the status of law quickly and without let or hindrance, at the push of a button. They pass retroactive laws, disregarding the prohibition of such legislation which goes back to Roman times. If they wish to arrange especially generous treatment for an individual or an organization, they pass laws using legal tricks which ensure de facto favoritism.

Moving on to the juridical branch of the state, the Prosecution Service is a centralized organization in Hungary. It is theoretically independent, not under the control of the government. In practice, however, and that is what is important, the chief prosecutor is chosen by the holder of supreme power, followed by a purely formalistic appointment by the parliament, which from then on is unable to effectively control him. The chief prosecutor executes the central will through the hierarchy that he heads. With a few insignificant exceptions, the investigation of all public scandals and cases of corruption involving individuals close to the present government party has got stuck in either the investigative or the prosecution phase of criminal proceedings. The Prosecution Service has, on the other hand, brought its full powers to bear on other economic scandals and cases of corruption in which people belonging to the current opposition are implicated. Dramatic, spectacular arrests are carried out for the benefit of the cameras, which arrive in droves. Compromising facts are often leaked while investigations are still in progress. No effort is spared to make sure that these cases come to court, though it is true that all too often charges have to be dropped in the prosecution phase, for lack of sufficient evidence; in other cases the charges are rejected by the court. And it is noticeable that the timing of a leak, of the bringing of charges or of a court hearing coincides frequently with some event on the political calendar: the mine which will destroy a rival’s reputation is detonated just before an election.

We seem to be witnessing a decided attempt by the ruling political group to take control over the courts as well. The President of the Supreme Court, who had been appointed before 2010, was dismissed early, before his mandate expired. A new institution emerged, the National Office for the Judiciary, which from the very start acquired exceptionally wide powers: not only to appoint judges, but also to decide which cases should be heard by which courts. Later, as a result of protests in Hungary and from abroad, the sphere of authority of Office was reduced, but its influence has remained significant. The retirement age fixed for judges was conspicuously different from average age limits and from the previous norms, with the result that the older generation was expelled. This affected several judges in leading positions within the judiciary system, who had been appointed before the present ruling group came to power, and although this measure was subsequently annulled by the relevant international court, so that the people involved obtained at least moral redress, most of them were not able to return to their previous leading positions.

Numerous members of the judiciary are unable to escape from the intimidating effect of the government’s measures. Some cases which come to court have political ramifications, and impartial experts in the field believe that some judgments are biased in ways that favor Fidesz policies. Nobody ventures to express an opinion about the number of cases involved. What is sure, however, (and encouraging) is that the ruling regime has not managed to subjugate the judiciary to the same extent as they have done in other spheres.

  1. By 2010 private rather than state ownership had become the dominant form of ownership. Since the U-turn, however, private property has become the target of frequent legal, economic and ideological attacks; the weight and influence of the state sector is rising again. The nationalization of private pension funds financed from the obligatory contributions of employers and employees, which was carried out using unique legal tricks, dealt a heavy blow to the principle of respect for private property. A similar form of indirect nationalization took place in the sector of saving and loan cooperatives. The state-owned sector has expanded significantly in the branches of banking, energy, public works, transportation, the media and advertising. In these areas the harsh means of disguised confiscation were not so often applied: property rights were bought instead. In many cases the previous owners were forced into a position where they felt they had no other option but to sell their property to the state, and at a price well below its market value.
  2. Up to 2010, decentralized mechanisms played an increasing role in the coordination of various activities. However, since the U-turn the tendency to centralize has become noticeably stronger.

This is primarily true of government administration. One of the major achievements of the change of regime was a significant increase in the powers of local government. The most obvious sign of regression is the fact that schools and hospitals no longer belong to local authorities, but are run from the bureaus of the central government. It is unprecedented – even on a world scale – that a misshapen bureaucratic giant has emerged, which decides over the heads of teachers, parents and local governments about staffing, curricular and financial matters in thousands of schools.

The obsession with centralization, which is intertwined in many ways with the aforementioned tendency to nationalize, affects almost all spheres of society: more and more  questions are decided at the highest level. A pyramid-like vertical hierarchy has emerged and solidified, with the supreme leader at its summit. Below him, ready to obey his every command, stand his hand-picked henchmen, who owe him unconditional loyalty.  Moving on down, we find the next level of the pyramid, and the next: for each position people are chosen for their loyalty to the regime. Commands which take obedience for granted tightly bind each subordinate to his or her superior. It is only the leader at the top who does not depend on his superior, only those at the very lowest level do not give orders to anyone. Everyone else incorporated into the levels in-between is servant and master at the same time. It is in their interests to hang on in there, to move further up in the pyramid. Their position is not decided at elections, but depends on winning the trust of their superior by services and flattery, or at least by uncritical obedience. Hundreds of thousands of public employees, including those who work in the state-run educational and health sectors, feel defenseless: few dare to speak up, to protest, because they fear for their jobs. The regime is robust, partly because it can surely count on the fear of the majority of people dependent on it, as well as on the ‘keep a low profile and obey’ mentality.

A very important decentralized mechanism is represented by civil society, a number of non-market based organizations and associations which are outside the control of state bureaucracy. In twenty years these have developed too, and have also become a means of scrutiny without which it would be impossible to expose and fight abuses of power. One manifestation of the U-turn is the methodical harassment of civil society. When parliamentary bills are being drafted trade unions and other relevant organizations are not consulted. Or if the people concerned express their point of view, in declarations or at demonstrations, their voices are disregarded. The indignant protest of the Norwegian government against the Hungarian government’s plans to interfere in their generous offer of assistance to Hungarian civil society is widely known.

While describing the processes of reversal I did not discuss the causes that induced   the U-turn. There were several important factors here: the grave mistakes made by the governments between 1990 and 2010 and the political parties functioning within and outside the parliament, the spread of corruption, the trauma caused by the appearance of mass unemployment, the increase of social inequality and the disappointment of a large proportion of the population after the high expectations brought by the change of system. It takes a long historical process for democracy to mature, and Hungary has just begun that learning process. It would be essential to complete a thorough causal analysis of the historical past; this, however, exceeds the limits of this paper. Therefore I will only deal with the new period starting with the 2010 elections.

2

When describing the coordinating mechanism of economic activities we cannot apply the metaphor of the U-turn: it would be more precise to call it a half-turn. Market mechanisms became dominant in Hungary in the first two decades after the change of system, and remained so even after 2010. Just as before, state and market continue to coexist in a symbiosis: there is no modern economy where these two social formations would not coexist and exert reciprocal effects.  The change that Viktor Orbán’s regime introduced is that now the state impinges on the economy in a much more aggressive fashion than the governments before 2010 did: it exerts more efforts to rule over it. This is done in many ways.

We are not talking about a case of ‘state capture’ carried out by a small group of oligarchs in order to establish regulations and pass measures in their own interests.  The direction of the process is the reverse. Orbán and the people who are close to him at the peak of political power decide who should become an oligarch, or who should remain an oligarch if he already is one, and how far his sphere of authority should extend.  Something similar takes place at lower levels too. The natural selection of market competition is overwritten by political considerations. “The important thing is that our man should win the public procurement tender, get permission to run a tobacconist’s or a casino, obtain tenure of that state-owned piece of land”. Tobacconists, casinos and land tenure all work on capitalist principles, but at the same time clientelism, a kind of feudal master-servant dependency, is asserted between the politician/bureaucrat and the capitalist entrepreneur.

A new term has been introduced into everyday Hungarian: ‘Fidesz-közeli cég’, meaning ‘a near-to-Fidesz company’.  Such firms do not belong to the party, but the sole or principal owner of the company is a crony of the political center. Maybe the association began a long time ago, at university or when the party was founded; or an individual’s career may have included a succession of political, bureaucratic and business activities. ‘Crony capitalism’ evolves. The intertwining of the worlds of business and politics is a global phenomenon, and provides fertile soil for corruption everywhere. What comes on top of this in Hungary is the social environment created by the aforementioned U-turn: the very organizations which should be fighting, with the authority of the state behind them, against the intertwining of business, politics and government and against corruption are not independent: they themselves are cogs in the same machinery. Just like any member of the Mafia, a corrupt politician or bureaucrat knows that the Mafia state will protect him – unlike the ‘whistleblowers’, who take personal risks to unveil corruption. The latter are not sufficiently protected, but often harassed, and even ‘character assassination’ campaigns are launched against them.

Viktor Orbán and those who implement his economic policies are swift to emphasize that if the state needs more income this will not be a burden for the people, and there will be no  ’austerities’. The new tax will be paid by companies, out of their profits. The word ‘profit’ itself has as bad an undertone as it did in the good old times when Marxist political economics was an obligatory subject for study. Above the usual forms of taxation special supertaxes have been used to pillage whole sectors, especially banking but also telecommunications, insurance, houehold energy supply, and a few other sectors. The effect of special taxes contributes to the fact that the volume of investments by private companies financed from their profits stagnates or barely increases. An unpredictable tax policy, legal uncertainty and anti-capitalist rhetoric discourage the ’animal spirit’; the propensity to private investment.[2] The extra-ordinary tax burdens ensure that the budget is balanced, which is reassuring for international organizations and credit rating agencies who are extra-sensitive to this indicator, but it does undermine an extremely important factor promoting growth and technological development. Moreover, it is not true that the extra burdens hit on the companies only, as they pass the extra costs, if possible, to the consumers.

While companies are held to ransom, the individual tax burden based on dividends has been significantly reduced. One of the first measures introduced by the Fidesz government was the abolition of progressive personal income tax, which was replaced by a flat rate of 16 percent, while at the same time value added tax was raised to an unprecedented 27 percent. It is known that in relation to the income of a given household, these tax rates impose a much greater burden on the living standards of people with low incomes than on those who earn more. Government propaganda proclaims as a great achievement the reduction of household expenditure on utilities through price-cap regulation. In reality, this price-capping policy is far more beneficial for the rich, as the bigger the flat, the more electricity, gas and water it uses, and the more rubbish it produces, the more it saves. We are all too familiar with the consequences of artificially depressing prices from the days of socialism. Companies make a loss, which in the end has to be scraped together by the community of tax-payers.

Restricting the functioning of the price mechanism is an important feature of the general phenomenon which has just been discussed: the state leans heavily on the private sector, using, among other means, administrative micro-interventions, fine-tuning of control and excessive regulation. Every economist who has studied the theory of market failure knows that appropriate regulation and well-aimed intervention can correct many problems caused by an uncontrolled market mechanism. This theory, however, at least tacitly, supposes that the state is at the service of public interests, and that regulation is carried out professionally and without bias. What happens if the levers of regulation are seized by incompetent or even corrupt people? What happens if a state whose masters use the state mechanism to preserve their own power interferes in the economy? Such interventions happen so frequently and affect the coordination process of the economy so deeply that sooner or later the half-turn can become a U-turn in this field as well.

The economic policy followed by Fidesz cannot win the approval of the conservative economist because of the upheaval that it causes to market mechanisms and the way it threatens private property. At the same time, it arouses rightful indignation in the liberal economist who is sensitive to the injustice in the distribution of income. It is not only the tax policy mentioned above, but various other measures must be disagreeable for them. The adherents of Keynesian economic policy must not let themselves be deceived by aggregate employment statistics. The revival following the depression is dragging its feet, the private sector is creating few new workplaces. The growing number of people in ’public work’ is supposed to make up for that. But they are employed for rock-bottom wages, 31-33 percent of the average salary, under degrading circumstances; they are not guided into the employment market this way, but kept permanently in their humiliating condition. Poverty and social exclusion are increasing at a dramatic rate. Enlightened societies would never tolerate the tone of voice that is used to stigmatize the poorest, or the way the homeless are chased out of cities by mayoral decree.

Any attempt to squeeze the classification of the Hungarian government’s economic policy into boxes labeled ’right wing’ or ’left wing’ is off-track. There is no question of the government intending to restore the socialist system, even though some phenomena are surprisingly reminiscent of the socialist era. The Orbán regime is not only compatible with capitalism, but each member of the power pyramid uses the opportunities offered by capitalism to their own advantage. When they launch an attack on banks or other sectors, they immediately conclude a special deal with this or that bank, sign ’strategic agreements’ with this or that large company in front of television cameras. ’Divide and rule!’ Instead of the left-right division, let us put the economy into another kind of spotlight: what best serves the survival of the existing power structure, the power of the central will, the interests of the higher levels of the power pyramid, including their financial interests? Suddenly it all falls into place and we know why this new institution or that new law emerged.

3

Hungary’s friends abroad, intellectuals, journalists, political and economic analysts, diplomats and politicians who take an interest in the happenings here, do unintentionally fall into various traps or misunderstandings. One of these is to overestimate the value of the letter of the law.  At first, the Fidesz government created a law which failed to guarantee the complete independence of the central bank. Not only the media, but also the competent international organizations exerted pressure on the Hungarian state to change the law. This finally happened. Those who had demanded the change felt they had achieved success. The propagandists in Budapest used it to illustrate how flexible and ready to compromise the Hungarian government is. In reality, what happened to the law was irrelevant. Having resigned from his position as minister of finance György Matolcsy, who the prime minister publicly dubbed “his right hand”, stepped out of the ministry, walked a few hundred yards and entered the doors of the Hungarian National Bank, as its theoretically independent governor. Without exception, every single member of the highest body of the central bank, the Monetary Council, was hand-picked by the supreme leader and his advisers; they are all loyal members of the consolidated machinery of power.

According to the letter of the law, every single selection process conforms to various seemingly neutral legal regulations. For example, for one position the current Prime Minister nominates a candidate, the competent parliamentary committee expresses an opinion, and he is appointed by the President of the Republic. For another position the parliament not only expresses an opinion about the candidate, but also makes the final choice. Does this matter? The parliamentary committee, the majority of the complete session of parliament (a two thirds’ majority, at that), and even the President of the Republic are all cog-wheels in the same machinery of power.

Another important example is how the regime leans on the press, television, radio and other means of telecommunication. This is about nothing less than the independence of the ‘fourth branch of power’, the liberty of one of the most important checks and balances which function in real democracies. The competent bodies of the European Union and the international press dwelled at length upon the question of whether the rights allocated  to the centrally appointed media authority were excessive or not. Finally, a few regulations of the law on the media were amended. The critics considered this a victory. Viktor Orbán and his colleagues, however, knew perfectly well that it was irrelevant. What really mattered was the fact that they had put their own people in charge of all television channels and radio stations owned, controlled and financed by the state, who then purged their staffs and turned all of them into the collective mouth-piece of government propaganda. The government or near-to-Fidesz entrepreneurs seized the freely distributed and very popular advertising broadsheets and other free local media products. The state media are obliged to use material provided by the news agency controlled by the government. This is not obligatory for the country’s privately owned media, but the latter are offered new state-produced material free of charge, while purchasing news from independent international agencies or trawling the foreign press is expensive. It is hardly surprising that they are reduced to using the free material. Self-censorship, a form of behavior all too familiar from the communist era, is becoming widespread.

There are newspapers, television channels and radio stations which are independent of the government, and critical of it. This is very important; it is part of the impartial description of the present Hungarian situation. However, many obstacles are raised to their functioning, for example during the distribution of broadcasting frequencies, when licenses are granted. Their main source of revenue is advertising. Not only the government’s own agencies, but also private companies which wish to maintain friendly relations with the political masters refrain from advertising with them. Discrimination manifested in the advertising market has been compounded by an advertising tax piled on top of the existing corporation tax. The relevant decrees were worded in such a way that 81 percent of the advertising tax was to be paid by one broadcaster, RTL, even though its share of the advertising market is only 15 percent. This is how one company has been punished for its dogged independence and regular criticism of Fidesz politicians.

No matter how hard the authorities try to subdue the organizations which form public opinion, the IT revolution has made their task more difficult. Stalin was able to surround his empire with almost impenetrable barriers, but nowadays this is impossible: computers, tablets and mobile phones connect the individual with the world through the internet, hundreds of thousands can express their opinions and organize themselves on social networking sites. The Fidesz government would love to find a way to prevent this too.  Not long ago it proposed the introduction of an internet tax. Each gigabyte data transfer would have been taxed to the tune of 150 forints (roughly 55 USD cents). Within a few days, mass demonstrations had been organized; images of the protesters circulated in the international press. Viktor Orbán retreated – half-way: as I write these lines it is not yet clear if the plan has been abandoned for good or merely postponed. Whatever may happen, the image of tens of thousands of demonstrators raising their mobile phones to the sky has become a symbol. The light from the tiny screens might even have illuminated the clouds of the internet – today no regime is able to raise impassable barriers to the flow of free speech.

 4

Here is another frequent intellectual fallacy: certain recently established Hungarian institutions, or new procedures that have been introduced lately, are similar or even identical to the parallel institutions of a traditional Western democracy – at first sight. Many changes have been made in the Hungarian judicial system. What is wrong with that? After all, even after these recent changes, in many ways it still resembles the systems of some European countries. The tobacco trade used to consist of small shops competing with each other. Now  only the government is allowed to issue a license for the sale of tobacco. What is wrong with that? After all, in Sweden a state monopoly with similar or even greater powers covers the trade in alcoholic beverages.

What we have is a mosaic, many pieces of which are original Hungarian products, while others have indeed been imported from democracies abroad. However, if we look at the mosaic as a whole, the outlines of Viktor Orbán’s Hungary emerge. It is actually better to move away from the static image of a mosaic to represent the relationship between ‘part’ and ’whole’. It is not a fixed state that we have to interpret, but a dynamic process. What we have to recognize is the direction that has been followed by each small component of the machinery since the starting point in 2010. From then on, at every new change, we, the observers, must notice which direction the change has taken. In the US, the mandate of the members of the Supreme Court lasts for the rest of their lifetime. There, this regulation has emerged within the framework of a stable democratic order, with many checks and balances in operation. In Hungary, on the other hand, for the first time now the vast majority of members of the Constitutional Court were chosen by the current prime minister – and in a few years all the members, without exception, will be Viktor Orbán’s nominees. If their mandate, is being extended right now, this move, along with other similar moves, will shift the legal status of the country towards irreversible power relations. Thousands (yes, the number is no exaggeration) of discrete changes, all moving together in the same direction, create a new system. Understandably, the Budapest correspondent of a foreign newspaper might write about only one outrageous measure without putting the event into the whole context of Orban’s system. An international organization or a foreign government might be justified in protesting against a specific measure taken by the Hungarian government, and in trying to exert its influence to have this measure modified or withdrawn. This article is intended to help those who form public opinion abroad and those who plan and implement measures taken in the world outside that concern Hungary to a better understanding that more is at stake than a momentary event:  this is now a strongly forged system, whose essential properties cannot be altered by partial modifications.

Another intellectual fallacy is the faulty evaluation of the legitimacy of the Orbán government. “Although I don’t like what is taking place in Hungary, it seems to be what the Hungarians want.” This opinion is further reinforced by the official propaganda, which is busy announcing that the regime won a two-thirds majority for two successive parliamentary cycles; there is no other government in Europe that enjoys such strong support.  Yet let us take a closer look at the facts.

Kornai table
At the last election only every fourth person entitled to vote expressed the wish that Viktor Orbán and his party should govern the country. The others either voted for another political faction or expressed their weariness and disappointment in politics by abstaining. By staying away perhaps some people wished to indicate that they found the regime repellent, but they did not believe that their vote would bring about any change. Political legitimacy is not a binary variable: no government is simply either legitimate or not – but measured against the continuous scale of legitimacy, support for the Hungarian government is low. The election system itself, introduced after the change of regime, has offered the opportunity for a considerable difference between actual political support and the proportions among the representatives.[3] That gap has further widened as since the 2010 elections the electoral laws have been modified seven times; while Fidesz lost more than half a million votes, and the fraction of all eligible voters who voted for Fidesz dropped from one third to a quarter, the regime used legal tricks to maintain a proportion of deputies which is higher than the critical minimum needed to pass laws requiring a two-thirds majority.[4]

There is another intellectual trap connected to the misinterpretations that I have just mentioned; those who have fallen into it may see the Hungarian state of affairs thus: “It is true that the Fidesz regime has abolished many democratic achievements. However, the present form of government must still be considered a democracy.” At this point the debate about what we call ‘democracy’ begins. There is no consensus between academic political philosophers and political scientists. The terminology used by people who are actively engaged in politics is interwoven with elements of political rhetoric. Where the term ‘democracy’ is an honor, the status of democracy is awarded or denied to the Hungarian form of government by the journalist, political analyst, politician or diplomat according to whether they hold a favorable or an unfavorable opinion of the present Hungarian system.  The terminological confusion remains even when ‘democracy’ receives a defining attributive. The expression ‘illiberal democracy’ was originally introduced to political science with pejorative connotations, while Viktor Orbán uses the term ‘illiberal state’ with self-assured pride to describe his own system.

An apt description of the present Hungarian political system / Source 168 Óra

An apt portrait of the present Hungarian political system / Source 168 Óra

Let us look at the set of previous and present historical forms of government that have characterized recent history. In one group we find democracies. Members of the European Union before its expansion, the US, Canada, Australia, New Zealand, Switzerland and Israel surely belong to this group, and as far as this article is concerned the question of which other countries might also belong can be left open for the time being. What is sure is that the essential common features do not exist only in theoretical texts, but can actually be experienced.  ‘Checks and balances’ are not merely requirements supported by arguments put forward by political philosophers – they really do exist, and their functioning can be experienced by observation. We can say the same about respect for minority rights; there are written and unwritten limits to what the majority, however large it may be, can do against the will of the minority. We could go on listing other important common features.

In the other group we have dictatorships.  For me, and for several hundred million other people, this is no abstract theoretical concept: it is a cruel, personally experienced reality.  Thirty years ago 28 countries belonged to one kind of dictatorship: totalitarian communism.

In between the two extremes, the set of all kinds of governments includes a subset; countries which belong here are neither democracies nor dictatorships, though they bear characteristic features of both. In my own work I have joined other authors in calling them autocracies.[5] This class is made up of a colorful multitude: I would place in it the pre-war regimes of the Hungarian regent Miklós Horthy and the Polish statesman Jozef Pilsudsky, or that of the Argentinean president Juan Domingo Peron in the post-war era. In our own time, besides the Russian president Vladimir Putin, the leaders of Belarus and many Central Asian post-soviet states rule over countries which belong to this subset.

I believe that under Viktor Orbán Hungary has moved from the subset of democracies  into the subset of autocracies. I am not talking in the future tense, about the danger of the country becoming an autocracy. The move has already taken place: the change has happened.

To consider Orbán a dictator would be to misunderstand the present Hungarian situation. Hungary today has a multi-party system, opposition parties function legally, newspapers opposing the government can be published. Political opponents are not imprisoned en masse; nor are they liquidated. We know all too well what real dictatorship is; we have experienced it, and what we are experiencing now is not that. However, to believe that Orbán is the leader of a democracy, and that although he breaks the rules of democracy from time to time, in the end he still behaves like a democrat, would also be a misunderstanding.  I do not even want to raise the question of whether Orbán, in the depths of his heart, is a true democrat or not. This may be an important question for his future biographer, but it is irrelevant for our analysis. We have to investigate what has actually already happened. And what has already happened is enough for us to say that Hungary now belongs to the wide subset of autocratic countries that are “neither democracies nor dictatorships”.

It would be a mistake to believe that Orbán is copying Putin. All autocracies are built on different historical traditions; they have emerged in different domestic and international environments, and the personalities and aspirations of their highest leaders differ. Orbán is not an imitator of others, he is a self-determining personality. This does not alter the fact that both the Putin and the Orbán regimes belong to the same subset of autocracies.

Hungary is the first of the post-socialist democracies that has joined the autocracies, but there is no guarantee that it will be the only one.  The balance of power might shift in other countries in such a way as to turn them into autocracies. There are foreign politicians who see Orbán as a model; there is a real danger that this contagion, leading to the loss of democracy and of the rule of law, will spread.

5

One of the sources of Viktor Orbán’s support is the fact that many see him as the staunch defender of the sovereignty of the Hungarian state, and of Hungary’s independence.  However, anyone who wishes to understand the Hungarian situation must realize that the problem cannot be shrugged off by simply labeling Orbán as a nationalist.

Worldwide, we can see two opposing tendencies. Globalization, the internet, the technical ease with which we travel, the emergence of transnational integration are all making the world more international. At the same time, national sentiments within the boundaries of a nation-state or in communities which reach beyond national frontiers but use a common language, and share common historical traditions, still persist; indeed, they are growing ever-stronger.

The change of regime not only brought about internal revival, but also coincided with the restoration of Hungarian sovereignty. “Russians go home!” was the first slogan; a happy separation from the East, an expectant turn towards the West. Western exports and imports were becoming more and more significant. Plenty of foreign capital was flowing into the country. Hungary joined NATO in 1999, and became a member of the European Union in 2004. In both cases, the intention to join was confirmed by a referendum, and in the campaigns leading up to these all the parliamentary parties, Fidesz among them, encouraged their followers to support the move. Although counter-opinions have always been present and voiced, for twenty years the direction of changes in foreign policy remained unambiguous. Hungary must be an organic part of Europe: it must unambiguously belong to the Western world; it must further strengthen the links binding it politically, economically and culturally to the West.

The year 2010 saw a peculiar U-turn in this area as well: unambiguity has been replaced by ambiguity. This emerges mostly in the rhetoric of official statements. Leading politicians grieve at public meetings about the crisis of world-wide capitalism and Western civilization. The leaders of the regime make use of the anti-EU, anti-American atmosphere; sometimes they go as far as to compare directives from Brussels with the pre-1989 dictates of Moscow. But if yesterday there was talk of the emasculation of the West and of the great things to be expected from the East, today’s discourse will be just the opposite. Orbán is proud of his Janus-face, and considers it the sign of his political shrewdness.[6] The content and tone of the words change, depending on whether they are intended for the Party faithful or spoken in Munich or Vienna at a conference for businessmen.[7] It is hardly surprising that both followers and opponents, both Hungarian and foreign observers, are mightily confused.

In the world of foreign policy and diplomacy official or semi-official statements can carry a lot of weight. Hungary is still member of NATO and the European Union; there has never been the slightest hint of any intention to leave either body.[8] The Hungarian government is happy to receive the plentiful financial support that flows from the EU; the only thing it insists on is full control over its distribution. (We have already mentioned the real motivating forces and intentions which govern state allocations.) At the same time the representatives of the ruling political regime regularly support Euroskeptic declarations.

The Hungarian diplomatic corps resolutely attempts (without much success) to establish business relations with various Asian autocracies and dictatorships, from Azerbaijan, Kazakhstan, Uzbekistan and the Arab Sheikdoms to Vietnam and China, pointing out that other countries do the same. This is purely about business; taking a stand for democracy and human rights is another issue. But they sometimes ’rise above’ this point: recently Orbán called Azerbaijan a “model state” when its dictator was on an official visit to Budapest.

Understandably, other countries take the keenest interest in Hungarian-Russian relations. As we noted earlier, the present Hungarian and Russian forms of government share several features; in this respect both regimes belong to the same subset of autocracies. But now we are not focusing on this similarity, but on the economic connections and relations in foreign affairs between tiny Hungary and huge Russia. In this relationship, how far can the sovereignty of Hungary be maintained; to what degree is it committed now and for the future to its Russian partner? The corollary is another question: how far do these present tendencies endanger Hungary’s commitment to the European Union, to NATO, to the Western world?

In order to be able to answer the question, we would need, for example, to know more of the conditions under which in January 2014 the Hungarian and Russian governments reached an agreement over the expansion of the largest Hungarian power plant, the Paks nuclear power station. I am not in a position to judge whether this large-scale expansion of Hungarian nuclear power capacity is justified, and if it is, whether the Russian proposal was the most advantageous in technical, financial and geopolitical terms of the possible alternatives.  What many people in Hungary and abroad object to, and with good reason, is the way in which the decision was brought. It was not preceded by public debate among experts; the government’s plans were pushed through the parliamentary law factory without the least publicity.  In this crucial issue, which will have a deep impact on the lives of many future generations, on European integration, on the foreign affairs of the country, on its commitments to its allies, the government confronted the public with a fait accompli.

Reflecting on the relationship between Hungary and other countries, the following question must be considered: what can Hungarians who worry about the U-turn, who fear for democracy, for the rule of law and for human rights expect from their foreign friends? A new development may be followed by cries of: “the West won’t put up with any more of this”. I am afraid many people nourish false hopes. The learning process is painfully slow; it takes years for foreign observers to realize there is anything wrong, and even longer before they put the different elements of the phenomenon into the right context.  And comprehension is only the beginning, what else is also needed if recognition is to be followed by some kind of action? This is a task that international organizations are not used to; they are at loss as to how an allied state can be forced to abide by the rules of democracy. Not many means are available. The European Union is unprepared for a situation where one of its members keeps turning against the value system and formal and informal norms of its community. And let us not forget that Hungary is only one small point on the map of the world; conflicting interests influence the motion of political forces. The special interests of countries, political groups, social classes and professions pull the main actors in many different directions. Threatening situations more important than the Hungarian one have proved impossible to solve reassuringly by peaceful agreements.

6

I have left the survey of the changes which have taken place in the ’ideological sphere’ to the end. A fundamental characteristic of communist dictatorship is the existence of an ‘official ideology’. The roots of its ideological history go back to Marx and Lenin, its terminology comes from the language of Marxist-Leninist party seminars. The communist party kept it up-to-date, and adapted it to the propaganda needs of whichever party line prevailed at the time. The citizen, especially the ‘cadre’ with a role in the system, was obliged to accept the ideology; he had to articulate it both verbally and in writing.

Following the fall of the old regime, the same main direction of change unfolded in this sphere too: the dominance of ‘official ideology’ was replaced by pluralism in the ideological world. Compared to this main tendency, we can observe a U-turn here too. The government strives to limit and discredit the principle of pluralism. It tries to force on society those theories, beliefs and norms of behavior that it considers the only acceptable dogma.

First of all, it vigorously established institutions which promote the execution of the central will. For the world of artists, pluralism and diversity are essential elements. Accordingly, in free societies many kinds of associations and unions, schools and groups coexist side by side, competing or even fighting with each other. The regime which seized power in 2010 selected a small group and invested it with powers that would be unimaginable in the West. Their main organization is the Hungarian Academy of Arts (Magyar Művészeti Akadémia). Other organizations and groups do still exist, but the name of this privileged body appears even in the constitution. It was given one of the most beautiful palaces in the capital as its headquarters, and made responsible for distributing the majority of publicly-funded cultural grants, as well as most awards and marks of recognition which come with financial rewards.

In the scientific world, the situation is similar. The Hungarian Academy of Sciences boasts a long history, and though its independence was severely curtailed by the party state under communism, its autonomy strengthened after the change of regime. It used to exercise considerable influence over decisions about which research projects should be funded by the state, through an institution which, like the American National Science Foundation, relied on expert opinion. Now, however, centralization has taken place here too. The National Innovation Office (Nemzeti Kutatási, Fejlesztési és Innovációs Hivatal), a leading state organization, was established. The Academy and other scientific organizations might try to express their opinion before final decisions are taken, but the days of a decentralized, professional and civil approach to funding allocations are over – the president of the office has sovereign decision-making powers. And who is that president? None other than the minister of education from the first Orbán government.

Turning to the sphere of education: the change of regime made the emergence of a real text-book market possible. The writers and publishers of school books could compete with each other; schools, or even individual teachers, could decide which books to use. Right now, competition is being abolished here too: a mammoth state text-book publishing house has been set up and granted what is effectively a near-monopoly.

What ideas is this increasingly centralized, nationalized, standardized machinery trying to promote? A return to the past is perceptible here too; not to the previous regime with its Marxist-Leninist ideology, but to an earlier ideological past. The official ideas of the pre-1945 Horthy period are being revived in various forms, with increasing strength. It is impossible to describe these with a handful of concise expressions such as nationalism, chauvinism, ethnic or religious prejudice or a conservative view of the family, because they appear in a variety of shades. Official politicians never make open and extreme declarations that would offend the ears of the civilized world; there are, rather, many covert hints and indirect expressions. But in that muted music, the marching tune for boots tramping out the same rhythm can be heard. To the ears of my generation the sound is familiar and frightening.

The images of cultural and academic life and of the world of ideas that I have highlighted here dovetail with the general description of the present-day Hungarian system, which was summarized in an earlier section of this article.  This sphere too bears the mark of an in-between state that is ‘neither democracy nor dictatorship’. The regime is trying to encroach in an increasingly aggressive fashion. Luckily there are large numbers of writers, poets, musicians, film-makers, artists, scientists, teachers and free-thinking intellectuals who will not allow themselves either to be intimidated or to be bought by money and rewards, and who protect their intellectual autonomy. Any visitor to Hungary can testify that intellectual life is thriving: great artistic works are born and significant scientific advances are made.

7

When I was giving lectures in the USA on a delicate and complicated situation, during the post-socialist transition, I was always asked the question: what should be done? What can we do? I admire and respect this readiness to act, but it is not my task to answer the question. My paper solely aims at revealing the situation; I wished to contribute to our American and other foreign friends’ better understanding of the Hungarian scenario.

What does the future hold for Hungary? One of the theories of democracy, linked mainly to the name of Joseph Schumpeter, deserves close attention. It does not dwell on how far a certain form of government expresses the ‘will of the people’, or at least of the majority. It considers democracy primarily as a procedure which enables the people to get rid of a government, not through the murder of a tyrant, not through conspiracy, military coup d’etat or a bloody popular uprising, but in a peaceful and civilized way, through elections which are well defined in legal terms, with many competing parties. The feasibility of dismissal is not a sufficient condition for a viable democracy, but it is a necessary one: it is the minimum condition.

It will be some time before we can say for sure whether this minimum condition is met or not. In Sweden it took forty years before the social-democratic government was dismissed at the 1976 elections. In Britain the conservative party ruled for eighteen years, from 1979 to 1997, before it was voted out of office. The historians of the future will give a final answer to the question of whether the minimum conditions of democracy are met in Hungary or not. However, many things are already clear.

Viktor Orbán and his party have ‘cemented themselves in’  – to translate an expression which has become commonplace in Hungary. The repeated modifications made to election laws were intended to favor a Fidesz victory, or rather, to make it an absolute certainty.  Should the need arise, the laws can be further modified without any hindrance. Fidesz was prepared for the unlikely but not impossible event of its failing to win a parliamentary majority at the elections. The mandates of many key positions, most importantly that of the chief prosecutor, the president of the republic, the head of the central bank, of the audit office and of the judicial office, extend beyond the current parliamentary cycle; they can all sit tight , even if the opposition wins. The Fiscal Council, a body appointed by the present government, but which would remain in office even in case of an election defeat, has not only an advisory role but also the right of veto over the budget submitted by a new government, and if that veto is used, the president of the republic may dissolve the parliament and call for new elections. In other words a few hand-picked men loyal to the present government would be able to overturn the next government.

All of this leads to the logical conclusion that it would probably be extremely difficult to effectively dismiss the government at parliamentary elections. In this sense, the situation that has emerged is nearly irreversible. Historical experience shows that an autocracy can only be brought down by an ‘earthquake’ that rocks the very foundations of the system.

Other future scenarios are also possible. The great events of history cannot be predicted on the basis of mathematical probabilities; every constellation is unique and unrepeatable. The situation could turn out a lot worse than today. The present Fidesz autocracy could react to the growing protests by hardening the repression. Or another way of events is also possible. Jobbik, the party of the extreme right, already represents a significant force; in more than one city its candidates have been elected as mayors. They speak undisturbed in parliament and in the street. What would happen if in a future election Fidesz did not manage to win a parliamentary majority? Would they be prepared to make a coalition with the extreme right? There is a historical precedent: towards the end of the Weimar republic the moderate right-wing conservative party entered into a coalition with Hitler’s party; together they constituted a parliamentary majority.

At the same time, favorable scenarios are not impossible either. What if more moderate groups within the ruling party are getting the upper hand, who are ready to stop on  the wrong track and turn back, in the direction to democracy and the rule of law? What if the opposition pulls itself together? What if new political movements emerge and win over millions? What if somehow, in spite of an electoral system which almost guarantees the defeat of future democratic forces, the tables turn?

Let us not give up hope.

—–

The printed text here contains very few footnotes. Further footnotes as well as a list of sources on the topic, in both English and Hungarian, will be available in a Web version of this article, available on the authors website: www.kornai-janos.hu.

[1] A few months after Fidesz took over the government I wrote an article entitled “Taking Stock”(“Számvetés”), which gave a summative overview of the main characteristics of the changes that had already taken place and which could be expected. Two volumes in Hungarian, edited by Bálint Magyar, were published under the title The Hungarian Polyp – The Post-Communist Mafia State.

The text here contains very few footnotes. Further footnotes as well as a list of sources on the topic, in both English and Hungarian, will be available in a later Web version of this article.

[2] The spectacular new projects inaugurated with pompous ceremonies by political leaders are mostly financed by European Union funds or are established by multinational companies.

[3] About half of the seats are divided among the parties in direct relation to the proportion of the votes. The other half are allocated in every constituency following the ‘winner takes all’ or ‘first past the post’ principle best known in the British system. That secures a large number of seats for a party which has even a small relative advantage over their rivals in several districts.

[4] Compare these figures with German data from 2013. The CDU/CSU received 29.7 per cent of the vote (41.5 per cent of those eligible actually voted). This is only slightly lower than the Fidesz results. But the actual proportions of votes are represented by parliamentary proportions in the Bundestag. Thus, Merkel did not have a majority, and a coalition with the Social Democrats is governing that country.

[5] In the related debates in Hungary, referring mostly to international sources, diverse terms have been in use, for example, ’managed democracy’, ’Führer-democracy’, or ‘elected despotism’.

[6] Viktor Orbán said the following in 2012: “There is a dance routine in international diplomacy. This dance, this peacock dance … has to be performed as if we wanted to be friendly. These are, let’s say, exercises in the art of diplomacy. … So we accept two or three out of seven proposals, those two or three that we have followed already, except they didn’t notice, and we reject the remaining two we didn’t want, saying ‘C’mon, we have accepted the other ones.’ This is a complicated game. Unless you insist, I’d rather refrain from entertaining you with the beauty of the details.”

[7] A characteristic scene of the ’peacock dance’ is the duplicity shown by Fidesz and the government towards Jews. More than once the government has emphatically  declared that it will not tolerate anti-semitism, and if necessary it will defend its Jewish citizens against any kind of attack. At the same time several government measures gravely profane the painful historical memories of Hungarian Jews. For example, it is falsely suggested in various ways that the deportation of hundreds of thousands of Hungarian Jews was forcibly imposed by Nazi Germany, while in fact Horthy’s state machinery was actively involved in it.

[8] A noteworthy exception: the Speaker of the parliament, a Fidesz member, at one point publicly referred to the possibility of ”backing out” of the EU.

How to rebuild democracy in Hungary? According to some, not by compromise with Fidesz

As I mentioned yesterday, there were two topics suggested by readers and I agreed that they were interesting and definitely worth spending time on. After tackling two surveys on Hungarian societal attitudes we can now turn to the question of “What will happen, what should happen after Orbán?” posed by Zsófia Mihancsik, whose writings have appeared more than once on this blogHer latest contribution is  a series of questions she thinks the democratic opposition should discuss even before the election campaign. At the moment the various opposition parties and groupings agree on one thing:  Orbán’s regime must be removed. However, some very important decisions must be made and agreed upon. It is for this reason that she as editor-in-chief of Galamus initiated a series of articles that might assist those whose job it will be to work out a common platform necessary for setting up a successful and lasting coalition.

The first question is: “Do we have to reach a compromise with Fidesz after the party’s loss of the 2014 elections?” In practical terms that means that the democrats must forget about all “the political and moral crimes that had been committed by Fidesz  in opposition and in power.” One can make a case for such compromise by pointing out that, after all, the voters of Fidesz represent a certain portion of the electorate.

If the decision is to seek a compromise, one must determine whether this compromise should be with the party itself, with its voters, or both. Moreover, how much should the democratic forces be willing to pay for such a compromise? And one ought to ponder whether such a compromise would actually achieve the desired result of political and social tranquility.

But if it becomes obvious that no compromise is possible either with Fidesz or its voters, then how should the new political leadership handle the coming conflicts? Can they in a democratic regime ignore a party that received the votes of many and is represented in parliament?

What should they do with “the products of Fidesz’s rule–the new constitution and all those new laws?”  These laws were enacted in order to build a centralized, state-dominated regime serving only the needs of an autocracy. Would it be enough to whittle away at them or, like Orbán, should they start everything anew and develop an entirely new regime? “In other words, can one build democracy on a set of laws that were designed to build autocracy?”

What should be done with party cadres who masquerade as experts? Should they be replaced? And there is the question of those who were appointed for nine or eleven years. What should be done with those people who, thanks to Fidesz, received land or tobacconist shops? What about the nationalized schools? Does one have to face the fact that these mostly illegal changes cannot be undone and that one must live with them? And if yes, what are the consequences?

More or less these were the questions that Mihancsik posed in her article.

The first answer to some of these questions came from Ferenc Krémer. You may recall that he was one of the early victims of the Orbán regime when he lost his job as professor of sociology at the Police Academy. He was far too liberal for that place. I will summarize the article in greater detail, but his message is crystal clear: there is no way of making a compromise on any level because one cannot build  democracy on undemocratic foundations.

Building blocks - flickr

Building blocks – flickr

Can one build democracy by undemocratic means or does one need consensus? Krémer’s answer is that neither road will necessarily achieve the desired end. After all, the 1989-90 regime change was based on consensus and yet it didn’t produce a lasting democratic regime. At that time consensus was easier to reach because all segments of Hungarian society desired the the same thing, the establishment of a democratic regime. But today the situation is different because, although “all democratic opposition forces assume that there is need in this country for democracy, the fact is that almost as large a segment of society gladly settle for a dictatorship.” Thus the reintroduction of democracy in Hungary at the moment, unlike almost fifteen years ago, does not have a solid societal foundation.

If the preconditions of a general desire for democratic change are missing, can one substitute for them concessions to those whose ideal is not exactly democracy? In Krémer’s opinion one can’t. In the past, no concessions to a Viktor Orbán-led Fidesz ever followed by any tangible result of cooperation. Moreover, the election will be decided by the now still undecided voters. In Krémer’s opinion “it is a grave political mistake to consider the undecided voters as disillusioned Fidesz followers and to talk to them as if they had anything to do with what happened in the Fidesz era. … It is very probable that one cannot offer anything to the Orbán voters that would change their minds and therefore one shouldn’t even experiment with such an approach because it only confuses the anti-Orbán voters.”

The democratic opposition first and foremost must decide whether Orbán’s regime is a democracy or not because “autocracy will remain with us as long as its institutions and its culture exist and function.” If the answer is that, yes, it is a democracy, then both the institutions and the people populating them can remain in place. In this case, in Krémer’s opinion, there will not be democracy in Hungary even after the fall of the Orbán regime.

Krémer then outlines a series of possible compromises that could be offered to Fidesz. What Fidesz institutions should be left intact? The Media Council?  The current system of public works? The “orbanization” of state lands? The national tobacconist shops? The nationalized and centralized school system? The militarized police? The Anti-Terrorist Center (TEK)? Forcing experts into retirement? Which ones?

What about some of the newly enacted laws? “Vote for which one you would like.”  The new labor law? The Basic Law, especially with its fourth amendment? The law dealing with the police? The law that dispensed with local autonomy? The law on churches that discriminates against some religious communities? Or what about the law in the making that would sanction school segregation?

What can they offer to the “servants of dictators”? Should they follow the policy of Imre Kerényi and György Fekete, commissars of national culture, or the views of the historians of MTA who decided that no György Lukács or Vladimir Mayakovsky can have streets named after them? Should one say that there is agreement regarding Fidesz’s concept of family or that one can believe in God in only three ways? “Yes, we could say it but then we wouldn’t be who we are.”

In brief, Krémer is unequivocably against any compromise. Naturally one could argue with his views, but his reasoning, in my opinion, is sound.

Ferenc Gyurcsány’s State of the Nation speech 2013, Part I

About two weeks ago I published the English translation of Attila Mesterházy’s policy speech. Some of you complained about the number of “ladies and gentlemen” in Mesterházy’s speech. In DK circles everybody uses the familiar “te,” including the former prime minister, and supporters call him “Feri.” There is another difference. Unlike other politicians, including Viktor Orbán who is considered to be a good speaker, Gyurcsány has no written text. He talks with the assistance of some scribbled notes and doesn’t have to look at those notes very often. Perhaps you will gain a better understanding of his style by watching a few minutes of the video of his speech.

The speech is long and therefore I will publish it in three parts. I want to thank the editors of Free Hungary for allowing me to republish it here. By the way, you can find a link to Free Hungary on the “Blog Role.” 

* * *

If we continue as now, the next prime minister will be called Orbán

“If we continue in the same way as now, the next prime minister will be called neither Gordon Bajnai nor Attila Mesterházi but will be called Viktor Orbán. Even though we would have every ground to put an end to Orbán’s governance and, theoretically, we have even the tools to defeat Orbán and his regime. Then, I’m repeating it again: if we go on in the same way as now, we will fail. A great lesson from the past year is that it was not Orbán’s government that caused a surprise. Frankly speaking, he cannot do that any more. The surprise is, if any, that the multitude of democratic people, including the voters, various movements, organisations, the media, a significant portion of intellectuals, who are still brave and committed enough to contravene Orbán, were not yet able to organize themselves, are not yet prepared for a fight ending with victory. But, if we have an influence on something at all, it is evidently the world of opposition. We are not so gullible to suppose that this government is interested in knowing what we are thinking about Hungary, it just does what it wants. We say what we are thinking, we try to show alternatives but, where we really have a great responsibility, where we really have tools, is to organize and train the democratic opposition for the fight, it is to show an alternative against Orbán. We need to do much more than we have done until now.”

The country is tired; there are too many hopeless people

“But still, let me begin with where the country is in the spring of 2013. I can’t say much new compared to the last year, at least not in quality. What we said about the country at that time and what we expected then, is true even today and our expectations have, unfortunately, not been fulfilled either. But we came to assess the state of the nation, we want to speak about the condition of the republic and therefore, let’s summarize, not in too much length, how we see Hungary. If I need to say it briefly, then I say that the country is tired, many, too many people have lost their hope and there is almost no field in the country’s life where we could say that it became a little bit better and more hopeful than was in 2010.”

This is no longer a constitutional state but an autocracy: the will of one single man replaces the constitution

“A debate has been going for a long time about, how to characterize this regime, whether this is still a democracy or already an autocracy, whether constitutionality is still alive. All that happened in the past few days is that this government is amending the fundamental law, said to be as hard as granite, for the fourth time now within one year by a huge package of 26 pages; this may convince even our rightist friends who have not lost their discernment yet that Hungary is no more a constitutional state. Namely, constitutional state means that we decide abidingly what the major frame, institutions and organizations of the state’s operation and the state’s structure are, what our relations to them are. This is what provides stability, the legal system is built on this and we go by this. By today, it has turned out that we do not have to go by the constitution because that may change, if necessary, every day even, but we have to go by the political will behind the permanent change of constitution, which is the will for power of one single person who is called Viktor Orbán. And where the constitution is not the rule but a person’s will, that system is called autocracy rather than democracy. Today, autocracy prevails in Hungary. However, those who want democracy, those who want republic, those who consider themselves democrats, such persons can only oppose this regime. We don’t want to have autocracy. We want to have a free republic with free citizens and those who want to have that, such persons shall require Orbán’s defeat. We are fighting for the defeat of this regime and for restoring the republic.

Decreasing real wages, decreasing consumption, decreasing investment, decreasing unemployment

“Three years ago, this government attained power by promising hope, by promising boom, by promising social justice. Today, the Hungarian economy is more vulnerable than it was in 2010. The shrinking of the Hungarian economy’s performance has been occurring for so many quarters and is becoming more and more serious. The country is in recession. The country’s common cake is decreasing continuously. Never before have so few jobs been established in the first month of the year than just in January 2013. Never before have so many, over 300 thousand people been unemployed without any provision than now. While, theoretically, there is no world crisis, not even in practice, while, of course, Europe has difficulties, but there is not a general crisis in Europe either, in Hungary real wages are decreasing, in Hungary consumption is decreasing and the level of investment is so low that there won’t be any growth in the forthcoming years either. So few homes are being built in this country, less than in 1944 when German troops marched in the streets of Budapest or Makó. We have to face a dark future. The country that obtains its living from investment, the country whose wealth or economy was driven by investment, by capital construction, is now one of the last ones among the investors’ target areas. There is neither investment, nor lending, nor jobs. This is a spiral from which we won’t be able to emerge still for many years.”

The rate of the decline of the Hungarian economic performance is six times higher than the European one: unimaginable depths of poverty and despondency

“The prime minister may say that it is caused by external effects. Partly, and only in lesser part, he is right. The rate of shrinkage of the Hungarian economy is six times higher than the European recession. In this respect, the Hungarian prime minister does not say the truth. Under such circumstances, while touring the country in the past months, we met such a depth of poverty and despondency that I have not seen even for a long time or have never imagined. Poverty has always existed in the history and I suppose it will always exist in the future as well. There will always be people or families, who live on the fringe of the normal human life. Who live from hand to mouth. If I needed to distinguish between poverty of today and that existing many years ago, then I would simply speak about the fact that today there are more poor people and poverty is deeper. I would rather say that earlier, there was at least the hope that you can emerge from it. If nothing else but the hope that it will be better for my children. Today, the hope is lost. Hungary became the country of despondency during Orbán’s governance.”

Only Orbán’s oligarchs are getting richer – the regime introduced the institutionalized corruption

“Those who are getting richer, belong to the world of Orbán’s oligarchs. Poverty has always existed in history and I suppose it will always exist everywhere in the future. But the situation that the political leader and his direct environment, the internal circle of Fidesz world is getting richer by corruption, this is a new phenomenon in Hungary. Such a thing has never happened earlier.”

School was taken away from children, parents and settlements, and only children of the wealthiest families can go to university

“Meanwhile, chaos prevails in the world of education, public education became the site of Christian conservative re-evangelization, the teachers do not know how long they will have their job and from whom they will receive their salary, who their employer is and what is expected from them. School was taken away from children, settlements and parents, they have nothing to do with it, this regime tries to force the free idea of free school to fit to a Procrustean bed, which, from this time on, will evidently not be free any more. While, when we speak about a free country, we naturally also take notice of the fact that there are thousands of different ideas and, since every family and every child is manifold, this manifoldness can be mediated only by manifold schools. That the university’s autonomy is taken away, that by today, universities are, basically, in the state of inoperability. They are not on the verge but in the state of inoperability. That the gates of universities are not opened but closed. That, except for the wealthiest families, almost nobody has the opportunity to acquire such diplomas, whilst the leading power, the intellectuals of the country, those who tailor shape to Hungary of the future will be recruited on the long run from the holders of these diplomas.

Despondency: More people go abroad than after 1956

“The reason for despondency is that more than half a million Hungarian citizens sought and found jobs abroad. More people go abroad than after 1956 and this is the sin of this government because they leave the country who are the most mobile, the bravest and the most venturesome. There are very many young people among them, who are really needed in this country but who do not find any opportunity and hope in Hungary.”

To the executors of the show trials: even bigger rogues than their supporters have collapsed in the past

Meanwhile, not even in a concealed manner, show trials are taking place in this country. I always said: “don’t worry about me, I can protect myself”. I have protected myself as well. The latest decision was made recently, which proved that it was a dirty, unfair calumniation in the autumn of 2006 that the politicians of my government, including me encouraged the police of the republic to use and apply illegitimate methods with the intent of intimidation or revenge. Not even the prosecution of Péter Polt was brave enough to, ultimately, fabricate a legally valid incrimination from this ignoble political accusation. This case was closed a few days ago. This is good. But they keep two of my former ministers, György Szilvásy and Pál Szabó under an unfair and false accusation. Miklós Tátrai is kept under an unfair and false accusation. It is the elementary duty of the democratic opposition to assume solidarity with those whom they want to assassinate in show trials. And I want to say silently and calmly to those who take part in this action that even bigger rogues than their support, Viktor Orbán collapse sooner or later. Their support will also fail and they will then face not a show trial but a great number of fair parliamentary and non-parliamentary proceedings where, after reviewing all papers and all letters, in my hope, it will be proved to the country that today, people are being damaged and bemired in an inhuman, unacceptable proceeding for, even unconcealed, political interests, just in order to smear their political rivals. Those who take part in this action do not simply break the law but are similar rogues as their support.

Hungary became isolated: it fawns upon Central-Asian despots

“Meanwhile, Hungary has become isolated. The country that was, erstwhile, the most European one in this region, today, has an eye to the East. It seeks friends in Baku rather than in Berlin or London. It unscrupulously allows an axe murderer to leave the country and fawns upon Central-Asian despots. Unfortunately, in this situation, in this world, an honest Hungarian democrat should be ashamed of his government rather than his country. We need to admit that we are ashamed of this government and our shame is strong enough that we do not want to live together with it. The country sank to knees, most of the Hungarian citizens lost all of their hopes and feel themselves in a hopeless situation”.

I have seen, how it is when the disappointed right-wing crowd rampages

“To conclude, it would be high time to defeat this government. In 2002 and 2006, I was among those who defeated Fidesz, defeated Viktor Orbán. Even under these experiences I have to say to you that, what we are doing now, where we are now, it will not be enough for the victory and what is at least similarly important, it will not be enough for successful governance. Let me start with the latter, in just 2 or 3 sentences. My friend, the evangelistic pastor Gábor Iványi said a few weeks ago that it was worth ridding ourselves of evil, if only for a moment. It was not an evangelical citation but referred to this government stating that it is worth winning even if the government to be set up as a result of this victory would not be able to govern for a long time. Such a sentence from a gospeller is nice. But from a politician, it is, in my opinion, unacceptable. However, every man shall stick to his trade. We must understand that, in case a multi-coloured coalition government, backed by a small majority, needs to govern within the current constitutional frames, surrounded by party soldiers appointed to the top of agencies that shall be independent from the government, while the country will be in an adverse condition, then we must worry about this government very much that it won’t be able to put in the forthcoming 4 years. I lead a stronger government than that after 2006. I have seen how it is when the disappointed right-wing crowd rampages. I have already seen how it is when, not the whole but part of the state apparatus acts against its government. I can imagine how it is, when everybody, from the president of the central bank to the public prosecutor, from the head of the competition authority to the president of the media authority – and now, I discontinue listing – endeavours to upset the government.”

(To be continued)