Tag Archives: Lajos Simicska

Breaking news: Rosatom was Viktor Orbán’s piggy bank

Lajos Simicska, the former friend of and financial adviser to Viktor Orbán, at last revealed his long-kept secret about the Hungarian prime minister’s plan to buy RTL Klub, the Hungarian subsidiary of RTL Group, on Rosatom’s money, 24.hu reported about an hour ago.

The crucial conversation between Simicska and Orbán took place in 2014, right after the electoral victory in which Orbán’s party again won two-thirds of the seats in parliament. In the course of the conversation, which was mostly about Fidesz’s media program for the next four years, Orbán announced his plan to purchase RTL Klub, the most popular and profitable television network in Hungary. Once it was under his control, he would put an end to the network’s programing. When Simicska expressed doubts about the feasibility of such a move, Orbán wanted to know the approximate purchase price, which Simicska estimated to be about 300 million euros, or 100 billion Hungarian forints. Orbán’s reaction was: “No problem, Rosatom will buy it for me.” It was at this point, Simicska contends, that their friendship came to an end. A week later, when they met again, Simicska told Orbán that he would not be a party to such an undertaking.

Simicska originally told this story in a two-hour interview with Reuters, but the Hungarian businessman stopped the publication of the interview once he realized that Reuters refused to include this crucial part of his interview.

Viktor Orbán  never bought RTL Klub, but about three months after the conversation with Simicska took place the Hungarian government began its frontal attack on RTL Klub, announcing its intention to levy heavy taxes on the media based on advertising revenues. The move was structured in such a way as to specifically target the German-owned RTL Klub. The idea was to force its owners to part with the financially squeezed Hungarian subsidiary. Orbán’s plans were foiled by the German company’s forceful resistance.

Gábor Vona is trying to cast doubt on Viktor Orbán’s past

Prime Minister Viktor Orbán and Interior Minister Sándor Pintér have faced some hard times in the last couple of months. There is, for instance, the Jürgen Roth story about Dietmar Clodo’s testimony that Semion Mogilevich may have bribed both Pintér and Orbán in the 1990s. This story might have induced Pintér to prepare the ground for the possibility of foreign attacks on both him and the prime minister. He added, of course, that whatever foreign secret service agencies have on them are forgeries.

And now Gábor Vona, chairman of Jobbik, is challenging Viktor Orbán about his alleged past as an informer.

The topic came to the fore two years ago when Lajos Simicska, Orbán’s former friend and the financial brain behind Fidesz, talked about the prime minister’s alleged involvement in the state security apparatus in 1981-1982 when he spent a year between high school and university in the Hungarian Army.

Questions about Orbán’s past are not new. Already in 1991 János Kenedi, one of the top experts on the state security apparatus in Hungary, after examining the relevant documents, declared that Orbán, if anything, had been the victim of intelligence gathering and was innocent of any wrongdoing. That testimony, however, didn’t put an end to speculation. Here and there someone finds a piece of evidence that stirs up suspicion again. One such occasion was the discovery by László Varga, director of the Archives of the City of Budapest, that Viktor Orbán’s dossier, titled “Viktória,” whose existence was a known fact, “had disappeared.”

What has been disturbing all along is that Orbán refuses to say outright that he never, ever reported on anyone in his life. At the time of Simicska’s accusation in 2015, Hír24 asked him this question. Orbán’s answer was not a categorical denial. He said that “the facts speak for themselves. All information is available on the internet. I suggest that you study them.” Magyar Narancs, commenting on this statement, asked: “Why can’t the prime minister’s office or the press secretary or he himself put together a simple sentence: ‘Viktor Orbán was not an informer and never reported on anyone.’” A good question.

Now, two years later, Orbán still refuses to utter this simple sentence. At the moment, the release of informers’ names is again a matter of debate in the Hungarian parliament, and Gábor Vona used the occasion to inquire from Viktor Orbán about his possible involvement. “Mr. Prime Minister, I know that during your military service you were in contact with the secret service. I also know, Mr. Prime Minister, that there was a member of your family who during the 1956 revolution was working for ÁVH as an agent.” Orbán’s answer was almost identical to his earlier response to the same question. “All documents are available on the internet, study them.” That was not enough for Vona, who then asked: “Do you have the courage to declare that ‘I have never been an agent and I didn’t report on anyone either in writing or verbally?’ Do you dare to declare it?” Again, Orbán refused to affirm it in the first person singular. Instead, he said that “naturally I was on the other side, just as all of us here. We were on the other side; we were the ones who were persecuted; it was in our apartments that they planted listening devices; we didn’t cooperate with any kind of service.”

Gábor Vona questioning Viktor Orbán

Not only did Orbán refuse to answer these simple questions but he wasn’t really truthful about the ideological commitment of the leaders of Fidesz in the 1980s. In 1985 László Kövér imagined himself and his friends in Fidesz as the future leaders of the existing regime, that is, the socialist people’s republic under Kádár or perhaps, given Kádár’s age, some younger, more dynamic leader. The “college” where these boys and girls from the countryside received extra educational opportunities was created to be “a school for political leadership.”

As for all those Fidesz members sitting in the parliament, who according to Orbán “were on the other side,” that is also an exaggeration. Several important Fidesz politicians were actually members of MSZMP, the party established by János Kádár and others during the days of the October 56 revolution. Just to mention a few: János Martonyi, György Matolcsy, István Stumpf, Sándor Pintér, András Tállai, Béla Turi-Kovács, and Péter Harrach.

The younger members of Fidesz would obviously like to bury the sins of their elders. Only recently, in connection with the demand for the list of informers, János Lázár declared that they were only victims and therefore their identities should be shielded. The real culprits, he claimed, are the former members of MSZMP who “denied the freedom and self-determination of the Hungarian people.” They are the ones who are traitors and who should never have any role in political life. One would like to remind Lázár that in 1989 there were 800,000 party members in Hungary. Moreover, if Fidesz professes to have such a pristine past, it should get rid of those politicians on their side of the aisle who were not exactly on the “other side.”

Viktor Orbán answering Gábor Vona

After the Vona-Orbán encounter, speculation abounded that Vona might have received damaging information about Orbán from Lajos Simicska, especially since Simicska’s son Ádám just recently optimistically announced that Jobbik will win the 2018 election with a two-thirds majority. (At the moment Ádám Simicska’s prediction has a zero percent chance of materializing.) Vona in an interview on ATV denied that he has any new information, but he added that if he learns anything he will not hesitate to make it public.

According to people close to Simicska, he makes no secret of his plan to release “seriously compromising documents” on Orbán close to the election. He talks quite freely about the circumstances surrounding his break with Orbán and keeps repeating that “it is his obligation to do everything in his power to facilitate the overthrow of the prime minister.” According to Fidesz politicians, Orbán as well as the leading members of the party consider Simicska a serious antagonist who “has money to spend and nothing to lose.”

March 21, 2017

Silencing the media: Hír TV

I have noticed in the last month or so that Fidesz and the Orbán government are paying far too much attention to Hír TV, which has gone through quite a metamorphosis since February 6, 2015, the day known in Hungary as G-Day . It was on that day that Lajos Simicska told the world that Viktor Orbán and he had parted ways. Moreover, he called Orbán “geci,” which I “politely” translated at the time as “prick.” In the original it was much worse. After this day Simicska’s daily paper Magyar Nemzet, his radio station Lánchíd Rádió, and his television station Hír TV, ceased to be government mouthpieces. I must say that, as a result, the quality of Magyar Nemzet and Hír TV has vastly improved. It is another matter that one can only marvel at the “ideological flexibility” of those reporters who remained, because the change from a pro- to an anti-government stance took place practically overnight.

The loss of Hír TV must have been a heavy blow to the Orbán government, which it tried to redress by getting Andy Vajna, the former American-Hungarian movie producer, to purchase TV2, a commercial station that serves the whole country. Although the producers of TV2’s newscast have been doing their best to tarnish the opponents of the government, Viktor Orbán is still not satisfied. At least this is the impression I got when I heard that Gábor Széles, a far-right Fidesz supporter, was ready to sell his Echo TV to Lőrinc Mészáros. With the change of ownership, the work of making Echo TV, a formerly right-radical station, into a replacement for Hír TV began. At the same time, Fidesz is doing its best to squeeze Simicska’s Hír TV financially.

Hír TV was Fidesz’s channel from the moment of its inception in January 2003. The first president of the company was the same Gábor Borókai who had been the government spokesman of the first Orbán government (1998-2002). Many of the channel’s early reporters actually ended up working for the government after 2010. In October 2015 Péter Tarr, deputy CEO of Hír TV, admitted that “members of the government’s communication team visited the station at least once a week in order to give instructions” to those responsible for the ideological content of the station. By 2007 Hír TV could reach 2.1 million households.

After G-Day, many of the top brass both at Magyar Nemzet and HírTV left, among them the staff of “Célpont” (Target), who were investigative journalists. For a while this very popular weekly program was off the air. Now, however, it is back, and rumor has it that considerable effort, financial and otherwise, is being expended to make it HírTV’s flagship program, alongside Olga Kálmán’s forthcoming interview show. Given the incredible corruption surrounding the present government, a program of this sort is certainly a good investment, especially since ATV doesn’t have the financial resources to include such a show in its programming lineup.

Distressed by all these changes at Hír TV, Fidesz and the Orbán government moved into action. Even earlier, the Fidesz leadership had forbidden members of the government and high officials of the party to accept invitations from Hír TV. Now they are putting pressure on cable companies, suggesting that they drop Hír TV from their offerings. One company, PR-Telecom, obliged and announced that as of January 1, they had dropped Hír TV along with six other, mostly foreign-language, channels. At the same time the company announced that 14 new channels will be available, among them six that are owned by Andy Vajna. While they were at it, the company picked up two porn channels as well. The majority stakeholder in PR-Telecom is an off-shore company in Malta, Central Eastern Cable & Media Group Limited, whose owner is the same man in whose yacht Lőrinc Mészáros was seen in the harbor of Zadar last summer. What a coincidence, don’t you think?

Soon enough Magyar Nemzet discovered that PR-Telekom had received state aid to the tune of 3.3 billion forints a couple of months before the cable company informed Hír TV of its decision to break its contract. The grant (and it’s an outright grant, not a loan) for improvements of the company’s network in certain regions of the country came from money Hungary had received from the European Union. This is how the EU is unwittingly aiding the undemocratic policies of the Orbán government. Luckily, not all is lost as far as Hír TV is concerned. Since the cable company’s breach of contract was illegal, those subscribers who would like to switch service providers can do so without any penalty. At least this is what Hír TV claims on its website.

Meanwhile Hír TV has been hiring people right and left. Some of them came from the defunct Népszabadság, others from the state television. The government mouthpiece, Magyar Idők, has been watching all this with a certain amount of apprehension. Its articles talked about the alleged tension within Hír TV because the same Péter Tarr who earlier had complained about government interference in its programming now announced that the channel will be even more “critical of the government.” The newspaper provided a long list of reporters who have already joined or will join Simicska’s cable network.

The government-sponsored Pesti Srácok learned that Simicska’s partner in Közgép Zrt., Zsolt Nyerges, had announced that he is no longer ready to sacrifice his quite significant wealth on Simicska’s “pointless fight” with Viktor Orbán while their business is dying. Apparently the “discussion” was so vehement that it almost turned into a fist fight. Whether such an encounter happened or not (Nyerges denies that it did), Közgép announced Nyerges’s retirement as CEO and the appointment of Ildikó Vida in his stead. Her name ought to be familiar to the readers of Hungarian Spectrum since she used to be head of the Hungarian Internal Revenue Service. She was suspected of corrupt practices and thus barred by the U.S. government from entering the United States.

Viktor Orbán takes the remaining few opposition electronic media outlets deadly seriously. As it stands, by now there are only two government-critical television channels left in the country. Both can be reached only by cable. Hungarian political observers are convinced that 90% of all media today is in government hands. Yet it seems that 90% is still not enough. Viktor Orbán seems set on silencing all voices critical of his regime.

This reminds me of an article by Ekaterina Shulman, a Russian political scientist, which I read in a Hungarian summary. She called Putin’s Russia a “hybrid regime,” 80 percent propaganda and 20 percent coercion. This description of the leading illiberal democracy also fits the regime Viktor Orbán has built in the last seven years. Even the arch-conservative Batthyány Circle of Professors, which in the past had found the state of the country to be picture perfect, recently called attention to the gap between “appearance and reality,” the former having the upper hand in today’s Hungary. And to sustain appearance and suppress reality a government needs a full pipeline of propaganda with a healthy dose of coercion.

January 16, 2017

Olga Kálmán is leaving ATV for Lajos Simicska’s Hír TV

The news of Olga Kálmán’s departure from ATV and her move to Lajos Simicska’s Hír TV has spread like wildfire. This unexpected event prompted scores of negative comments on the Assembly of Faith, the fundamentalist sect that owns ATV. Columnists also bemoaned the sad state of the Hungarian media, which leaves someone like Kálmán with only two choices: either ATV or Hír TV. They reminded their readers that only a couple of years ago Hír TV was part of the Fidesz media empire. Its journalists made it their mission to hunt down all those liberals whom they considered Viktor Orbán’s enemies. Since the Simicska-Orbán fallout two years ago, however, quite a few newcomers joined the staff and its most vicious mud-slingers left. They will find a congenial home in Lőrinc Mészáros’s new acquisition, Echo TV.

It is an anomaly that a basically conservative or even right-wing sect like the Assembly of Faith keeps up a liberal television station. So the clash of cultures within the walls of ATV should have been expected. Critics claim that Sándor Németh, the leader of the Assembly of Faith, made a deal with the devil in 2012 when, they suspect, he agreed to some level of cooperation with the government in return for his sect’s “recognized” status. The Assembly of Faith is certainly the odd man out among the 26 accepted churches.

The first program that ATV scrapped was the Újságíró Klub with György Bolgár, Tamás Mészáros, and János Avar. Every Monday night the three seasoned reporters, with the assistance of a moderator, discussed the main political events of the previous week. In June 2014, after 14 years of great popularity, ATV did not renew their contracts, allegedly because of lack of interest in the program. Its replacement was a flop and died after a single season.

In May 2016 Sándor Friderikusz got the boot, ostensibly because his excellent conversations with intellectuals were deemed to be too serious for the station’s audience. Friderikusz’s liberal outlook was most likely the real reason. In October Friderikusz gave a lengthy interview to Index in which he described the state of affairs in the studios of ATV under the direction of Sándor Németh’s son, Szilárd. Friderikusz recounted a conversation in which Sándor Németh inquired from him whether he was purposely working for the downfall of Viktor Orbán.

And about a month ago we learned that András Bánó, the long-time director of ATV’s excellent news, is leaving the station. Most people doubt that his departure is voluntary. The pressure is on to get rid of certain people.

Meanwhile, there have been signs that the Assembly of Faith, under the leadership of Sándor Németh, is supporting the government’s views on the migrant issue. ATV, for example, agreed to air the government’s anti-migrant ads, which many faithful ATV viewers strenuously objected to. As we learned lately, Sándor Németh is also an admirer of Donald Trump, as you can see from the photo he posted on his Facebook page.

Sándor Németh, leader of Assembly of Faith, is a very happy man

While serious programs have disappeared one by one, a few “light” programs have been introduced. I can’t imagine that ATV’s viewers like Péter Hajdú’s Frisbee or Zsuzsa Csisztu’s Csisztus24. These programs simply don’t belong on a television station that has until now functioned as a quasi public television station. Today I took a look at both: they are dreadful.

Another “lighthearted” program is Judit Péterfi’s Magánszféra, which is supposed to let us in on politicians’ private lives. I described the program after the first episode as “an extended flirtation between the reporter and the politician, initiated primarily by Judit Péterfi.” Another new program, this one for women, seems to be superior to the other new shows–as long, that is, as one can tolerate Henrik Havas’s constant bragging.

I have no idea how these new programs are faring, but I doubt that they are hits. Friderikusz characterized Szilárd Németh’s leadership of the station as “amateurish,” and the latest changes in programming seem to justify his opinion. If Szilárd Németh, who is apparently under the thumb of his father, keeps going in this direction, ATV will soon disappear. I wouldn’t be at all surprised if by next season most of the new programs are scrapped. It was time for Kálmán to leave. It’s just too bad that the only television station that it is still independent belongs to Lajos Simicska. At least this is the opinion of Kálmán’s fans.

On a brighter note, ATV announced that Egyenes beszéd will continue but Szabad szemmel (With Open Eyes) with Antónia Mészáros on Friday evenings will be discontinued. My hunch is that Mészáros, who is a fine reporter, will take over Egyenes beszéd.

The Fidesz media was shocked by the news of Kálmán’s departure for Hír TV. They immediately went into attack mode. According to Magyar Idők, “the employees of Hír TV were perplexed when they received the news that Olga Kálmán was joining their station.” It’s not just the old hands at the station who are worried about their jobs but even those who joined Hír TV in the last couple of years. Magyar Idők learned that “the leadership of ATV has been worried for some time that Hír TV wants to compete with them by espousing a political view farther to the left than ATV is at the moment.”

Origo seems to be worried about Simicska, who allegedly will be overpaying Olga Kálmán. According to Blikk and other right-wing tabloids, like Ripost and 888.hu, Kálmán’s Egyenes beszéd (Straight Talk) is not at all popular. They seem to know that ATV’s “most often watched program is ATV Start, an early morning show.” Moreover, Kálmán’s presence seems to be immaterial to viewers. There was no appreciable difference in the size of viewership when in her absence someone else was before the cameras. So, concludes Origo, “the departure of Olga Kálmán is not an irreplaceable loss to ATV.”

Lokál, a free paper owned by the mysterious Árpád Habony, a right-hand man of Viktor Orbán, portrays Kálmán as a workaholic who was still in the studio four days before her son’s birth and, “as soon as she delivered, she was immediately on the phone on a work-related matter.” The impression these publications are trying to convey is that Kálmán is not only an unpopular TV personality but is also a bad mother. Simicska is wasting his money. All this sounds like sour grapes to me.

When it comes to the offerings of ATV, we must keep in mind that during the day the station airs two-and-a-half hours’ worth of infomercials in addition to the dubbed 700 Club with Pat Robertson, lasting 30 minutes twice a day. On Sundays, one has the pleasure of listening to Sándor Németh’s sermon Vidám Vasárnap (Joyful Sunday). Of course, this is also repeated later. ATV receives quite a bit of money from the Orbán government for airing a documentary series called Hazahúzó (Drawing you home), which depicts different regions of the country. These programs are supposed to be magnets for Hungarians living and working abroad. As we know, all these efforts have been singularly ineffective. This daily program is 40 minutes long and is aired twice a day. So, as you can see, there is a lot of filler here.

During the day I also took the time to check out Hír TV’s fare and found quite a few good programs, including their newscast, which was thorough and professional. At first glance it seems that Hír TV has more substantive programming than ATV. They have only 30 minutes of infomercials, they don’t have to air government propaganda for expats, and they don’t have to show such programs as the 700 Club or Németh’s sermons. On the basis of my sampling, it is definitely worth taking a look at Simicska’s station, quite independently from Olga Kálmán’s joining its staff.

December 18, 2016

For Viktor Orbán the Hungarian media is still too free

I understand that Viktor Orbán is mighty annoyed with the independent media, which in his opinion remains far too critical of his government. For instance, hard-working journalists have unearthed an incredible number of corruption cases. I know that people like to complain about the quality of Hungarian journalism, and I myself often grouse about articles that are hard to follow or are sloppy. On the whole, however, Hungarian journalists should be commended for working under difficult circumstances for very little money. There are a couple of politicians who decided to specialize in exposing corruption cases, like Ákos Hadházy (LMP), Péter Juhász (Együtt), and lately Bertalan Tóth (MSZP), but the bulk of the corruption cases came to light thanks to the growing number of investigative journalists.

Investigative journalism was a new field in post-communist Hungary. I still recall how feeble the first attempts were in the first half of the 1990s. But by the early 2000s there was a handful of first-rate investigative reporters who were, for example, instrumental in informing the public about the enrichment of Viktor Orbán and his family, which was of course modest in comparison to the situation today. And by now there are at least two NGOs, Direct36.hu and Atlatszo.hu, that are non-profit investigative journalism centers “with the mission to expose wrongdoings and abuse of power through fair but tough reporting.”

Orbán would like to tone down or, better yet, stifle the media’s outcry over what’s going on in government circles. His government’s first move was to transform the public broadcasting system, whose staff even before 2010 had been less than independent from Fidesz influence, into a totally servile government propaganda machine. An incredible amount of money was and continues to be poured into a TV station that practically no one watches. Once the low viewership numbers became obvious, the government started a new channel specializing in sports, which is used as a “pseudo news channel.” Every fifteen minutes or so “government news” is broadcast between sports events. This way there is no escaping the news–news that bears a suspicious resemblance to that broadcast in the Rákosi and the early Kádár regimes. People in the trade swear that by the second half of the 1980s journalists at the state television and radio stations had more freedom than employees of the state television and radio stations do today. Just one example. Journalists stopped people on the street to ask about their reaction to the migrants. When one woman said that she has no problem with them, she was told that they are not interested in what she has to say.

Prior to February 2015 the government had an extensive, loyal media network thanks to Lajos Simicska, Viktor Orbán’s high school friend who owned a TV station, a radio station, a daily newspaper, a free paper distributed at metro stations, and a weekly magazine. The last two publications were also available online. With the fallout between the two old friends, however, Orbán lost Magyar Nemzet and HírTV, both of which were critical for his government, especially since the “state television” (MTV) turned out to be a flop. So, the pro-government gurus moved into high gear and within a year and a half managed to build an even larger network of media outlets. And they haven’t finished their job yet. Friends of the government are buying up popular media properties and transforming them into propaganda machines.

To replace Magyar Nemzet a new pro-government daily was created called Magyar Idők, which is not exactly a favorite of the public. On a list of the fifty most popular online news sites Magyar Idők didn’t make the cut. Mind you, neither did Magyar Nemzet, which in my opinion has become a quite respectable paper in the last year and a half. In addition, several other pro-government internet sites came into being, among them ripost.hu, a tabloid that has a decent-sized readership (179,842/day in July 2016).

chain

The two most popular sites are origo.hu (561,494/day) and index.hu (513,854/day). The former was recently purchased by a cousin of György Matolcsy and has since turned decidedly to the right. Apparently the future of index.hu is not at all assured because the current owner, Zoltán Spéder, is no longer a favorite of the prime minister. There are still a couple of popular independent internet sites like hvg.hu and 444.hu that trounce the official government hirado.hu in readership. Could they be in the government’s crosshairs? Surprisingly, nepszabadsag.hu is not a popular news site, despite the fact that the print version is the most popular nationwide daily paper. But even Népszabadság’s fate is not quite settled yet. There is talk about Vienna Capital Partners selling Népszabadság to the owner of Duna Aszfalt, László Szíjj, who was described by Népszava as a possible front man, along with Lőrinc Mészáros, of Viktor Orbán.

On the television front, government propaganda lost HírTV, but after a lot of finagling Andy Vajna, the former American-Hungarian movie producer who is now the owner of several casinos and a loyal friend of Orbán, purchased the German-owned TV2. Vajna, who is not exactly a poor man, didn’t have enough money for the purchase so the Orbán government gladly lent him 8 billion forints, which most people believe will never be paid back. TV2 was heavily indebted at the time of Vajna’s purchase, and it is unlikely that it will suddenly become wildly popular, surpassing the favorite commercial television station in Hungary, RTL Klub. Only a couple of their shows are attracting a larger audience, while RTL Klub has at least six such favorites.

Passing TV2 to Vajna was not quite enough for Orbán, who would like to have a quality television channel specializing in news. It looks as if there is an attempt to upgrade Echo TV, which is owned by Gábor Széles, a rich man of extreme right-wing political views. Echo TV’s current audience is very small. However, I just read that Ferenc Szaniszló, who had a weekly program and who belongs to what I call the lunatic fringe, was fired and that Echo TV is being reshaped to be a more respectable outlet of news and political discussions serving the government’s needs.

Apparently, Orbán hoped that Lajos Simicska would give up his losing media outlets. In the past, when the two men were still friends, Magyar Nemzet and HírTV received government ads galore in addition to thousands of subscriptions for government offices. Since the blow-up no government advertising money has come Magyar Nemzet’s way. Moreover, the paper isn’t getting much in the way of ads from the private sector either since rich businessmen who are heavily dependent on government orders are afraid to advertise in opposition papers. This is the way the government ensures that papers they consider to be disloyal will starve to death.

Orbán’s aim was the total destruction of Simicska’s media outlets, but so far he hasn’t succeeded. The only victim was the free newspaper Metropol, which used to be distributed at metro stations. One day the Budapest Transit Authority (BKV) broke its contract with Simicska on the grounds that he had received the right of distribution without a tender. BKV immediately signed a contract with Árpád Habony’s Modern Media Group Zrt., whose new publication, Lokál, took its place. I might add that Modern Media Group also received its contract without any competition. Lokál, being a free paper, depends on advertising, and it is chock full of government ads. The government is keeping it afloat.

The picture is grim and, I’m afraid, it can be grimmer still. One can only hope that Orbán, in his insatiable appetite for a servile media, will not gobble up every important outlet, leaving only crumbs for the opposition. If, for example, pro-government owners were to acquire hvg or index, it would be an irreparable blow to the democratic opposition.

September 22, 2016

Two men who put up a fight: Lajos Simicska and Bachar Najari

Among the active members of Hungarian Spectrum there has been a long-standing debate about the most useful attitude toward the Orbán regime’s very existence and future. There are those who get upset when they encounter pessimism regarding the removal of the present Hungarian government. They think that defeatism is counterproductive and take every opportunity to raise their voices against naysayers. Among these people we find some who think that these pessimists are actually Fidesz propagandists whose job is to spread the dogma of Fidesz invincibility. But, to be fair, one doesn’t need to be a Fidesz troll to feel less than optimistic given the state of affairs in the country.

I for one agree that the proverbial Hungarian pessimism can become a self-fulfilling prophecy, which should be avoided at all costs. But, at the same time, we must admit that overcoming the obstacles that Orbán and his minions have placed in front of those desiring change is a formidable task.

Today I would like to hearten those who are worried about Hungary’s future by writing about two men who decided to stand up to the government. The first is Lajos Simicska, Orbán’s friend from high school, who reaped all the benefits of the mafia state until his falling out with the prime minister about a year and a half ago. The other is Bachar Najari, a Syrian-Hungarian-Swiss businessman, the new owner of the famed Zsolnay Porcelain Factory in Pécs. Although for different reasons, both were targeted for financial annihilation by a corrupt regime. It looks as if the powers that be are finding it difficult to destroy them.

Some people believe that Lajos Simicska’s contribution to the creation, development, and final accomplishment of Fidesz was even greater than Viktor Orbán’s. After all, it was Simicska who brought home the bacon. Of course, in the process he himself became immensely rich. But then came the falling out. Orbán, being a vindictive man, decided to ruin his old friend financially.

Simicska’s most important business venture is Közgép, a construction company that specializes in building highways and railways. As such, it is heavily dependent on government orders. Thus, Simicska looked like an easy target. Indeed, right after the blow-up between the two men, the government suspended midstream the highway that was to be built by Közgép. The second move was that the Public Procurement Authority (Közbeszerzési Hatóság), which handles government tenders, “discovered” that Simicska’s firm had cheated on one of its tenders. It was decided that as punishment Közgép would not be able to compete for any government jobs for three years. Simicska went to court and won, both in the lower court and also on appeal.

Trying to ruin Simicska through Közgép was not enough. Orbán instructed István Tarlós, mayor of Budapest, to break a long-term contract with Simicska’s firm, Mahir Cityposter. In 2006 the firm acquired the right to provide the city with 761 large cylindrical kiosks. The contract was to be good for 25 years. Ten years later the city suddenly “discovered” that the contract was not fair. When Simicska didn’t remove the kiosks by a specified date, the city ordered them to be forcibly removed despite a court order to stop the vandalism. Simicska promptly hired György Magyar, a very able lawyer, who said from the beginning that the case was absolutely clear-cut. And indeed, he was right. A few days ago the court agreed with the argument Simicska’s lawyer presented and forbade the removal of the kiosks while the case is pending before the court of appeal. The city will also have to pay 6.8 million forints in court costs. If the city loses, it will have to pay Simicska 600 million forints in damages.

Perhaps Simicska’s savviest move to date has been to form a consortium with the Italian company Itinera, which has been described in the Hungarian media as “a big gun.” Itinera has been “active in large-scale infrastructure projects and civil construction for more than 75 years in Italy and around the world.” Közgép together with Itinera presented a bid for a 27 km-long section of the M4 highway between Berettyóújfalu and the Romanian border. Their bid was 58 billion forints or approximately 188 million euros. Two other consortiums were also eyeing the job: (1) a consortium of three Hungarian companies whose bid was 84 billion forints or approximately 268 million euros and (2) a French-Slovak-Czech consortium that bid 87 billion forints or 272 million euros.

The difference in price is staggering. It seems that Simicska with this offer wanted to show the fair (admittedly, probably on the low end of fair) price of road construction and to highlight the graft that is normally built into these bids. In the case of the Hungarian consortium it was as much as 26 billion forints or 80 million euros. In this particular case almost 3 million euros per km would end up in someone else’s pocket. Of course, it is still possible to find fault with the Közgép-Itinera tender if Viktor Orbán so desires, saying that price is not everything, but apparently the Közgép-Itinera bid is also best in every other category, including environmental considerations. The consensus is that it will be very difficult to award the project to anyone else.

 

Now we can turn to the case of Bachar Najari, the Syrian-Swiss businessman with a Hungarian wife who also speaks fluent Hungarian. How Najari ended up owning the Zsolnay porcelain factory is a long story, which I pretty well told in a post titled “How to ruin a businessman with government help.” The upshot of the story is that one of Viktor Orbán’s oligarchs, Attila Paár, decided that he would like to own the factory because many of the vintage buildings in Budapest that will be restored or even rebuilt will need the famed terracotta tiles Zsolnay was famous for in the last decades of the nineteenth century. Najari had managed to put the formerly city-owned factory on solid financial footing, and it looked as if from here on it would be a profitable enterprise, especially with the impending sale of roof tiles. There was a fairly large loan which had been taken out by the city earlier from the Hungarian Development Bank for which Najari offered a certain amount of money to settle the account. The bank declined the offer and instead sold the debt for half of what Najari had offered to Attila Paár. Meanwhile, the city of Pécs decided to help Paár along by setting up a bogus company to which it recruited more than half of the workforce of Zsolnay. These workers are actually on paid vacation and no one knows who pays them. The situation was compared by one of the workers of the factory to a gangster film from the 1930s.

gangsters

Najari decided to fight. First he managed to get back his stock, which had been placed under sequestration. He used his own money and made good on the debt he inherited when he bought the factory from Pécs and also paid 90 million in local taxes, although it was a disputed item. Therefore there was no more reason for the city, which owns 19% of the stock, to take over the factory. Then the Kaposvár court refused to register Pécs’s new porcelain manufacturer, called Ledina Kerámia. Finally, the court in Zalaegerszeg turned down the request for a liquidation of the Zsolnay factory. A few days ago the city of Pécs “sold” the nonexistent Ledina Kerámia to an unnamed off-shore company. The city claims that the sale, for 3 million forints, “will ensure the jobs of those workers who were enticed to leave Zsolnay because it was to fold soon.”

Meanwhile work is being done at Zsolnay. Najari refused to be intimidated, and it seems that he managed to foil the attempt to rob him blind.

Although it is not easy, these two cases show that a person can win as long as he has the means and the determination to stop the Orbán regime’s unscrupulous, illegal activities.

September 19, 2016

Another government shake-up: Greater confusion guaranteed

János Lázár has been the focus of a great deal of media attention of late. His often provocative behavior and his less than diplomatic comments about fellow politicians and important oligarchs made a lot of political observers wonder when Viktor Orbán will deem it necessary to shove his currently number one man into the background. The discussion over Lázár’s political future gained intensity last fall with the appointment of Antal Rogán as chief of the Prime Ministry’s Cabinet Office, nicknamed Viktor Orbán’s propaganda ministry, which was created especially for Rogán. Some people believed that the creation of this new office weakened János Lázár’s position. There were also reports that Lázár was not too keen on the idea of placing another center of power inside the Prime Minister’s Office.

Speculations over Lázár’s future flared up again when a week ago he announced the retirement of Mrs. László Németh, undersecretary in charge of financial services and postal affairs. Her appointment as minister of national development in 2010 caused quite a stir. She was an absolute unknown without much educational background. But she was Lajos Simicska’s close friend and business partner. Through her Simicska pretty well controlled the whole ministry of national development. In 2014 Orbán, who was obviously already thinking of loosening Simicska’s influence over financial matters, replaced her with Miklós Seszták. Surprisingly, this was not the end of Mrs. Németh’s career. Orbán found a place for her in the Prime Minister’s Office. Mrs. Németh hasn’t yet reached the official retirement age of 65, and therefore I assume that her “retirement” wasn’t exactly voluntary. But Fidesz will find a job for her somewhere else.

Mrs. Németh’s “retirement” is probably not related so much to the Orbán-Simicska fallout as to the so-called Spéder case, about which I wrote earlier. The case is very complicated, but the most likely explanation for Viktor Orbán’s ire and his decision to unseat one of his formerly favorite oligarchs was Spéder’s less than subservient behavior toward his benefactor. Certain financial transactions were made that, in Orbán’s opinion, hurt his government’s interests. It was Mrs. Németh who was supposed to keep an eye on Spéder, which she failed to do. At least this is the most likely charge against her.

But what does all this have to with János Lázár? Quite a bit. First of all, a week ago Lázár announced that Zoltán Spéder is his friend, whom he is not going to abandon. According to rumor, the police have taken, among other things, taped telephone conversations between Simicska and Spéder, which were most likely recorded by Spéder. Whether this rumor is true or not, most likely in Orbán’s head there is a connection between Simicska, Spéder, Mrs. Németh, and perhaps even János Lázár.

In record time Mrs. Németh was replaced by Andrea Bártfai-Mager and was given the title of government commissioner, a position that carries ministerial rank. Bártfai-Mager is a member of the National Bank’s Monetary Council, so György Matolcsy, chairman of the bank, may well have recommended her for the job. Most significantly, Bártfai-Mager will not be under the supervision of the head of the Prime Minister’s office, János Lázár, but will report directly to Prime Minister Viktor Orbán.

Mrs. László Németh and her replacement, Andrea Bártfai-Mager / Source: 444.hu

Mrs. László Németh and her replacement, Andrea Bártfai-Mager / Source: 444.hu

With these changes Lázár will lose power over important sectors of the government edifice: the affairs of the Hungarian Development Bank and 18 state-owned companies associated with it; the Hungarian Postal Service, which unlike its American equivalent is an important financial institution; and the integration of the credit unions, which used to be handled by Spéder. Lázár will end up looking after such things as public administration, rural development, EU subsidies, national policy, and heritage conservation.

Although strictly speaking it is an entirely different matter, I should mention in passing that it also looks as if the troublesome issue of the House of Fate, a kind of Holocaust Museum Orbán style, which was most likely Lázár’s idea in the first place, will be taken out of his hands. The task of doing something with the brand new, impressive building, which has been standing empty for well over two years, will be assumed by Zoltán Balog’s already overburdened ministry of human resources.

There is widespread consensus in Hungary that Orbán is heading a government that functions very badly. He himself seems to realize its shortcomings. But his usual fix is to change the government’s structure. He makes ad hoc decisions on structural changes, decisions that by now have resulted in a bloated government and total chaos. Dozens and dozens of government commissioners and over one hundred undersecretaries with all sorts of special jobs have only increased bureaucracy. The talk is always about efficiency and reducing the number of civil servants, but the number of political appointees keeps going up.

Now, it seems, Viktor Orbán has come up with yet another reorganization of the government. The announcement, which was totally unexpected, came from János Lázár this afternoon at his regular Thursday government “info.” He said very little about the details, not because he tried to be secretive but because I suspect he himself doesn’t know much about the impending changes.

So, what’s in the offing? I think Index put it best: “Orbán turns everything upside-down: he is creating two little governments.” Yes, this is the gist of it as far as I can ascertain. As it stands now, once a week the ministers and their undersecretaries get together for what we in English would call a cabinet meeting, presided over by Viktor Orbán. In Hungarian it is called “kormányülés” (government meeting). It is here that final policy decisions are made.

Now, in addition to this group, Orbán will create two “cabinets.” One will be called “gazdasági kabinet” and the other “stratégiai kabinet.” These cabinets will have wide decision-making powers. The idea is that these cabinets, whose membership will vary depending on the subject matter discussed, will allow government officials to focus on important questions in greater depth.

Such an arrangement might make sense if these “cabinets” had only an advisory role, but I don’t see how the decisions of the weekly meeting of ministers and those of the lower-level cabinets can be brought together into a cohesive whole. I’m convinced that the chaos and confusion that now exists in the Orbán administration is nothing compared to what will happen when two mini-governments compete with the real “cabinet.” I don’t know whether such an arrangement exists anywhere else in the western world or whether Viktor Orbán’s latest brainchild will have the dubious distinction of being a unique addition to his illiberal state.

July 7, 2016