In the last few weeks György Matolcsy, chairman of Hungary’s central bank, appeared before parliament twice, and his performances there have been the butt of jokes.
The Hungarian National Bank is supposed to be an independent entity in the sense that its chairman cannot be instructed either by the government or by parliament as far as its monetary policy is concerned. Parliament can, however, exercise a supervisory function over the bank’s activities. Given the recent scandals surrounding the Hungarian National Bank, Matolcsy was required to answer questions from the floor.
On both May 17 and June 13 Matolcsy was asked about the details of the bank’s foundations and the billions these foundations either lent or gave away to Matolcsy’s friends and family members. On both occasions, MSZP’s Gergely Bárándy posed the questions, questions that Matolcsy either couldn’t answer or refused to answer. He simply brushed them aside and repeated three times: “Sham! Sham! Sham!” He declared that anyone who attacks him and the National Bank is doing great harm to the Hungarian currency. In return, Bárándy called him a liar. A few days later the Hungarian National Bank’s press department announced that Chairman Matolcsy is suing Bárándy for slander.
This first performance was followed by a second, when again the opposition pressed Matolcsy regarding the money that was passed to the small bank of Tamás Szemerey, who happens to be Matolcsy’s first cousin. MSZP members of parliament also wanted to know what Szemerey’s wife was doing on the board of one the central bank’s foundations.
Matolcsy’s answer was curious to say the least. He has many cousins who have not received any money from the Hungarian National Bank. For example, László Trócsányi, the current minister of justice, is also a cousin through the Darányi and Héjjas families. Moreover, Márton Kasnyik, a journalist at 444.hu who is very critical of him, is also a cousin. Trócsányi, “although he greatly admires the bank chairman,” rushed to correct the record. He is in no way related to Matolcsy, he said, although Matolcsy had earlier claimed that the information about the family ties came from Trócsányi himself. As for Kasnyik, Matolcsy’s claim is far-fetched. Their last common ancestor lived sometime in the eighteenth century.
Bárándy didn’t stop at family ties. He also asked the bank chairman about numerology. He wanted to know whether it is true that Matolcsy has something against the number 8, and whether it is true that he banished the offending number both inside and outside of the bank. No more Room 8 inside. And the official address of the bank was changed from Szabadság tér 8-9 to Szabadság tér 9. Also, Bárándy wanted to know whether it is true that only people who were born on August 20, 1984 can work in the secretariat of the bank. Matolcsy’s reaction was one of great indignation. But instead of denying the rumors, he simply insisted that his antagonists are concocting conspiracy theories against him.
It was at this point that people began to question the mental competence of the bank chairman, including Gergely Bárándy himself who expressed his doubts about Matolcsy’s mental state on ATV’s Egyenes beszéd (Straight Talk).
Before I return to Matolcsy’s more serious problems, let me insert a bit of family history here. The Matolcsy genealogy was thoroughly researched by a relative, and the almost 100-page family tree is quite impressive. Students of history know the Matolcsy name mainly because of Mátyás Matolcsy (1905-1953), apparently a brilliant economist who ended up as a far-right politician in the 1930s and 1940s. He became a member of the Arrow Cross party and in 1946 received a ten-year jail sentence. He died in jail. Mátyás is only a distant relative of György.
It is a mystery why Matolcsy felt compelled to bring up the Darányi and Héjjas families. Kálmán Darányi, prime minister of Hungary between 1936 and 1938, is associated with the radical right in Hungarian politics, especially during the second half of his premiership when he appointed Germanophile politicians to his cabinet and had a hand in the preparation of the First Anti-Jewish Law. As for the Héjjas family, Iván Héjjas is synonymous with the White Terror. While Pál Prónay was in charge of the summary executions in Transdanubia, Héjjas was at the helm in the territories between the Danube and the Tisza rivers. Search me why a sane man would brag about such a lineage in connection with an alleged relative who turned out not to be a relative at all.
Turning back to the pressure being brought to bear on Matolcsy. After two years of wrangling in court, the Hungarian National Bank was ordered to release a study Századvég did for the bank for the modest sum of 1.8 billion forints. It turned out that the study the bank received had nothing whatsoever to do with the topic Századvég was supposed to analyze. It was, it seems, just another instance of money being laundered through Századvég with the assistance, in this case, of the National Bank.
Yesterday Matolcsy received a letter from Mario Draghi, chairman of the European Central Bank, who explained again that “Article 123 TFEU prohibits the ECB and national central banks from purchasing public debt instruments directly on the primary market.” In brief, the Hungarian central bank cannot invest in government bonds even if they are purchased on the primary market by its foundations.
And one final note. There are people of some importance in the Fidesz ranks who have reservations about Matolcsy’s activities. One is Gergely Gulyás, one of Orbán’s deputies, who is usually an eloquent defender of everything the Orbán government does. So when he says that “there have been some questionable financial decisions by the foundations,” it must mean that not all the Fidesz bigwigs support Matolcsy, that they are worried about the troubles his activities have brought to the party. Further proof that Gulyás must have reservations about the increasingly shady affairs of the government and other Fidesz-controlled institutions like the prosecutor’s office or the National Bank is that in a recent interview he admitted that several times he had toyed with the idea of leaving politics altogether. Indeed, this articulate, smart, always impeccably dressed “young gentleman,” coming from the upper middle class of the Buda bourgeoisie (budai úri fiú), simply doesn’t fit in with the likes of the brutish Szilárd Németh, his fellow deputy chairman of Fidesz. He comes across as someone who, in a different setting, would be a traditional conservative, and a conservative could never feel entirely at home in Fidesz.