Tag Archives: film industry

Andy Vajna in Hollywood

When Andy Vajna, the producer of such Hollywood blockbusters as Rambo, Die Hard with a Vengeance, and Terminator, decided to settle in Hungary, he hit the jackpot. In the United States, as a result of his questionable business activities, he had been harassed by the Internal Revenue Service (IRS) for fourteen years and was lucky not to land in jail. In Hungary the Orbán government makes sure that Andy can carry on with his shady activities absolutely undisturbed. In fact, he knows that the boss of the mafia state, which Hungary has become in the last five years, will make sure that his by now numerous business activities will thrive.

For a while, between the late 1980s and 2010, Vajna split his business activities between Los Angeles and Budapest, but then there came a time when he had to realize that his heady days in Hollywood were over. His last hurrah was Terminator 3, which he produced with his old business partner, Mario Kassar. At the time an article appeared in Entertainment which described Vajna and Kassar as has-beens or worse. “A dozen years ago, Kassar and Vajna were names that could open doors. But by 2003 half the town thought they were dead, and the other half figured they were probably in self-imposed exile. That’s the kind of reputation you get when you find yourself at the center of one of the great flameouts in Hollywood history.” The article indicated that the two “spent wildly on unworkable projects and unmentionable extravagances. Soon enough came federal investigations and bankruptcy proceedings.”

Vajna’s and Kassar’s company, Carolco Pictures, did exceedingly well, especially after 1986 when it completed a $50 million debt offering in the junk bond market. Between 1986 and 1989 Carolco’s staff grew from six to 100. The company, however, was being watched by the IRS because Carolco’s finances were anything but transparent. Behind the complicated business setup and clever machinations was a tax lawyer, Peter Hoffman, who soon enough was accused of filing false tax returns for 1989. The prosecution alleged that “Hoffman evaded taxes by tapping into a deferred compensation plan and calling the payments loans while he was chief executive of the film production company Carolco Pictures.” Hoffman’s first trial, held in October 1997, ended in a mistrial. Reporting on the result, the Los Angeles Times wrote that “the government’s failure to convict Hoffman puts a dent in an ongoing larger criminal tax fraud investigation into Hoffman’s former colleagues at Carolco, producers Mario Kassar and Andrew G. Vajna.”  The same article described the business network of Kassar and Vajna as a “system of byzantine offshore companies.”

Andy Vajda and Mario Kassar during their earlier days in Hollywood

Andy Vajna and Mario Kassar during their earlier days in Hollywood

Less than a year later, at a retrial, Hoffman was fined $5 million but avoided jail time. It was a “much watched case, one that federal prosecutors had hoped would assist them in a bigger criminal tax fraud investigation of movie producers Andrew Vajna and Mario Kassar.” But this was not to be. Later Vajna said that Hoffman was a good man who refused to cooperate with the federal investigators and testify against them.

Magyar Narancs, in an article published in 2011, expanded on the “system of byzantine offshore companies.” In 1989, the same year in which Hoffman filed false tax returns, Andy Vajna decided to get out of Carolco Pictures, in which he had a 36% stake, for which he received $100 million. He was supposed to pay $40-50 million in taxes on the sale, but with Hoffman’s help he managed to move his money into shell companies in Panama and the Netherlands Antilles. Of course, in movie land it was not only Vajna and Kassar who went to great lengths to avoid paying the taxes they owed. About this time the IRS set up a special unit to investigate Hollywood moguls it suspected of tax fraud. In fact, the investigation into Carolco had begun even before Vajna decided to leave the company, and it was most likely this investigation that prompted his exit. The “byzantine system” was so complicated that even market analysts were unable to navigate through the maze of companies. As a result of Hoffman’s machinations, the company made barely any money. A few million a year.

The IRS was after Vajna and Kassar for fourteen years. Among other things, the investigators uncovered large interest-free loans from the company to Vajna and Kassar. In 1988 alone, according to Magyar Narancs, they received $8 million, which they spent on art work and real estate, as well as on covering their gambling losses. The IRS alleged that between 1988 and 1990 Vajna and Kassar sold 75% of Corelco’s stock, in the amount of $286 million, through their offshore companies, on which they paid no taxes. Vajna’s share of the loot was $107 million. The tax case was settled out of court. Instead of the $41.1 million the IRS said it was owed, Vajna paid $6.5 million.

Vajna’s next business venture in the United States, Cinergi Pictures Entertainment, wasn’t exactly a success story. It was established in 1990. By 1993 it lost $4.2 and in the following year, $16.1 million. By April 1997 it was announced that “the troubled independent film company, hammered by losses from such films as ‘The Scarlet Letter,’ ‘Judge Dredd’ and ‘Nixon,’ will pass virtually all of its library over to Walt Disney Co. in lieu of paying Disney $38.4 million advanced to Cinergi to make movies.” Cinergi IPO’d at $14.50 a share in 1992. By 1997 its stock price was just a little over $1. The Los Angeles Times reported that “the company has said it has not been identified by the U.S. attorney as a target of the probe,” although Vajna himself was “the subject of a federal grand jury investigation involving his personal tax returns.”

Five months later, in September 1997, Cinergi’s fate as a public company was sealed. It agreed to a management buyout offer of $2.30 per share, or about $31 million. “Under the deal, Cinergi would merge with CPEI Acquisition Inc., a company formed for the buyout by Andrew Vajna, Cinergi’s president and chief executive, and Valdina Corp.” CPEI Acquisitions, registered in Delaware, still exists on paper, but there is no information about it online. Valdina Corp. is an even more mysterious entity. Bloomberg Business couldn’t identify any of its key executives, but it did learn that Valdina has a P.O. Box in Castorweg in the Netherlands Antilles.

Vajna and Karras got together again after 2000 and produced a number of films, the best known of which was Terminator 3, which was a financial success. Sometime before 2010 Vajna decided to give up his career in Hollywood to become Viktor Orbán’s commissioner in charge of the Hungarian film industry. And to start his shady business dealings all over again, this time in a more congenial environment.

“Son of Saul” and its reception by the Hungarian right

A month ago Medián conducted a survey on the current state of anti-Semitism in Hungary. This was Medián’s fourth such survey since 2006, and the results are not exactly heartwarming. During this period Medián measured the number of extreme and moderate anti-Semites as well as those who are free of anti-Jewish prejudice. The good news is that the number of extreme and moderate anti-Semites dropped from 38% to 32% between 2013 and 2014, but of course this is still way too high in comparison to the United States, Canada, Australia, the United Kingdom, the Netherlands, or Denmark, although it is more in line with some other Western European countries such as France and Spain. For a handy comparison, see the Anti-Defamation League’s Global 100.

Jobbik, Hungary’s neo-Nazi party, is well known as a racist organization which has two arch-enemies, the Jews and the Roma. Although Gábor Vona, the party leader, believes that the party ought to move more to the center of the ideological spectrum to attract larger popular support, many members of the top leadership are staunch anti-Semites who have serious reservations about the new strategy. Moreover, as the Medián survey illustrates, 75% of Jobbik voters are also anti-Semitic.

It is difficult to keep the Jobbik party members in line, especially when there is a hot topic that stirs up the Hungarian anti-Semitic crowd–in this case, the new film “Son of Saul,” which just won the Grand Prix at the Cannes Film Festival.

No one, except for the people at Cannes, have seen the film yet, but critics find it exceptional. For example, “no single entry in this year’s competition impressed more than first-time Hungarian director Laszlo Nemes’ ‘Son of Saul,'” or “‘remarkable’ may not do Laszlo Nemes’ holocaust drama ‘Son of Saul’ justice.” By all indications, the film might be a strong contender for next year’s Oscar.

László Nemes, director of Son of Saul in Cannes

László Nemes, director of Son of Saul, in Cannes

But the far-right crowd, including some of the leaders of Jobbik, are not at all happy. They were already outraged when Imre Kertész won the Nobel Prize for his book “Fateless” in 2002. As far as they were concerned, the book was not good literature and Kertész received the prize only because the Holocaust is a theme guaranteed to garner acclaim in literature as well as in the film industry.

László Nemes, the young director of the film, tried to get money for the production from all over the world, but in the end it was the Hungarian government’s fund for the arts that underwrote 75% of the project. When the funding decision was made in 2013, Előd Novák, one of the most outspoken anti-Semites of Jobbik, complained bitterly. He pointed out that this was the second film on the Hungarian Holocaust that had been paid for by the Hungarian government. The first one, directed by Lajos Koltai, was based on Kertész’s book (2005). Novák grumbled that “Fateless” had received 920 million forints, and now another Holocaust film was getting 205 million. Moreover, the committee also allocated 4.5 million forints for the development of a movie script (“The Lawyer”) about the trial of the Jews accused of ritual murder in Tiszaeszlár in 1882, “naturally written from the point of view of the lawyer who defended the Jews.” Instead of such films, he argued, the Hungarian government should support films about national heroes and great moments in Hungarian history–for example, the Battle of Pozsony (Pressburg/Bratislava) of 907 or the Ragged Guard (Rongyos gárda) that defended the western borders of Hungary in 1921. Novák called all this interest in the events of 1944 no more than “Holocaust industry.”

Novák is not impressed by the success of “Son of Saul.” He wrote on his Facebook page a couple of days ago : “Now they expect me to fall on my face because of the international success of the Hungarian Holocaust film. But it is not merely a joke to say that the greatest holiday of the Jews is the day the Oscars are given out…. Kate Winslet confessed that she decided to take a role in a Holocaust movie because then an Oscar is guaranteed. Earlier she had been nominated four times, but didn’t win once.” Winslet received the Oscar for her role in “The Reader” (2008).

For the government and its supporters, the fact that it was a government grant that made the production of “Son of Saul” possible comes in very handy. A group of right-wingers on HírTV who discussed the film had difficulty mustering enthusiasm for the prize and often referred to the Holocaust as a theme that guarantees critical success. One of the participants thought that “picking the Holocaust as his subject was a clever move on the part of a first-time director.” But, however critical they might be, they argued that the production of a film about the Holocaust “proves that there is no anti-Semitism in Hungary.”

György Dörner, the far-right director of Új Színház whose appointment by Mayor István Tarlós was accompanied by demonstrations and protests, expressed his hope that László Nemes’s next film will be about that great battle between Árpád and the Bavarians in 907. Előd Novák’s views on the real task of the Hungarian film industry must have made a great impression on Dörner.

The Orbán government is trying to change the general perception that it doesn’t do enough to combat anti-Semitism in the country. Today I read with astonishment that from here on students at the Péter Pázmány Catholic University will be required to take a course on the Holocaust. Keep in mind that the Catholic University is an institution close to the heart of policy makers. The rector of the university explained that he had been impressed by the view of Israeli Ambassador Ilan Mor that days of remembrance are not enough, that something new and different is needed to make a real impact. The one-semester course will be called “The Holocaust and Remembrance.” It seems that there is already a compulsory course called “Introduction to Catholic Teaching.” The right-wing reaction to the Catholic University’s decision is predictable.

As for “Son of Saul,” once it is available for public viewing, I suspect there will be a very serious discussion about the accuracy of its depiction of Saul as a member of the camp’s Sonderkommando. One such article already appeared in mandiner.hu.

Two Hungarian films about homosexuality: Falsehood and the truth

While researching an entirely different topic, I encountered by chance a description of a Hungarian-made film called “Coming Out.” On closer observation, it turns out that the film is about “how to come out of being gay”–that is, how to “cure oneself” of being gay. Shortly after the film appeared in November, a reviewer claimed that it “is the most harmful Hungarian film ever made.” He came to that conclusion on the basis of the comments that appeared under a review of the film in Index, which were full of venom, hatred, and anti-Semitic remarks.

I, on the other hand, see it somewhat differently. Yes, it is most likely a harmful film, but not because commenters make ugly remarks about gays, liberals, and Jews. It is harmful because it is a falsification of medical facts. Instead of enlightening the terribly ignorant Hungarian public on the phenomenon of homosexuality, it leads them farther down the road of ignorance.

Some twenty years ago, in the infancy of the Internet, I signed up for two discussion groups dealing with Hungary. One was in English, the other in Hungarian. By now I don’t remember on which one we had a Hungarian psychiatrist who one day came out with the brilliant observation that “homosexuality is like smoking. One can get hooked but one can also quit.” It seems that even twenty years later many Hungarians haven’t changed their attitudes.

The story of the movie is as follows. Erik, an openly gay radio personality, is planning to marry his partner, Balázs. Then comes a motorcycle accident, as a result of which he slowly discovers that he is “in truth” attracted to the opposite sex. Who is the object of his newly found heterosexual desires? His own physician, Linda.

The producer of this film is Gábor Kálomista, a man known for his right-wing sympathies. It received 280 million forints from the fund established by the Orbán government under the supervision of Andy Vajnai, formerly a producer of such serial Hollywood blockbusters as Rambo and Terminator. Vajnai is a practical guy for whom box office numbers are the measure of success. When he arrived as Viktor Orbán’s man in charge of film production, he decided to change the direction of Hungarian filmmakers’ activities. Hungary was known for winning all sorts of international prizes but, Orbán and Vajnai pointed out, nobody went to see these films. They didn’t make any money.

The result of the total reorganization of the Hungarian film industry was that for three solid years no Hungarian film was produced. But then “Coming Out” appeared. Since the money for the production came from the Christian, family oriented Orbán government, one couldn’t expect to see a real “coming out.” Moreover, since the newly organized film industry wanted high ticket sales, the plot had to appeal to the majority, conservative audience. Apparently it worked. By the end of January 110,000 people went to see the movie.

It seems that this pseudo-science is what the Hungarian public wants to believe. They can go home after the movie and discuss with friends and family the “fact” that homosexuality is an illness which can be cured, if necessary by a knock on the head. They can go on and talk in the style of Zsolt Semjén about “bearded liberals” who lead innocent children into sin by luring them into sexual deviance.

This film is a reflection of the generally phony world of Orbán’s Hungary. Falsifying history, falsifying science: all is well as long as the government’s propaganda machine, assisted by the churches, satisfies the needs of the population. Moreover, this is film is just a drop in the bucket. For instance, Péter Róska, a theologian, explains on Magyar Rádió that “homosexual tendencies” are acquired traits because “they haven’t found the homosexual gene.” The whole western world, he continues, is in danger because of the “gender ideology” that is directed by gays and feminists. This kind of pap is being fed to the Hungarian public.

SturmlandIn sharp contrast, a Hungarian-German film, naturally not supported by Andy Vajna’s fund, won top honors in the “first film” category at the Berlin Film Festival. The film, entitled Sturmland/Viharsarok (Land of Storms), is about three gay men wrestling with their sexuality in an unaccommodating environment.  A review I read of the film describes the background as something that “belongs to a forgotten Europe.” A Hungarian football player returns from Germany and gets romantically involved with a local man. Both men endure separate experiences of violence as word gets out about them. In the end the football player is murdered. Berliner Zeitung wrote a very favorable review of the film in which the reviewer emphasized that the movie is about “the dreadful logic of repressed homosexuality and the deadly hatred of homosexuals.”

Two films, two worlds. One is reality, the other reflects the awful emptiness of a mendacious world created by Viktor Orbán and his Christian Democratic allies who have a free rein in matters of education, culture, and film production.