Tag Archives: Zoltán Spéder

The state of the Hungarian press on World Press Day

Yesterday was World Press Freedom Day, proclaimed by the UN General Assembly in December 1993 following the recommendation of UNESCO’s General Conference. So, I think it is fitting to devote a post to media freedom in Hungary.

Only a few days ago I took a look at Freedom House’s latest assessment of press freedom in 199 countries, which concluded that Hungarian media freedom has been severely constrained since 2010 when Viktor Orbán’s Fidesz party won the election. Although the Orbán government proclaims that the media enjoys total freedom, the fact is that by now the overwhelming majority of the media outlets in Hungary are either under state control, like the so-called public television and public radio, or have been acquired by Fidesz oligarchs who are willing conduits of government propaganda. Media experts estimate that by now 90% of all media content is in Fidesz hands.

Lőrinc Mészáros, Viktor Orbán’s alter ego and front man, owns, by the latest count, 192 newspapers in Hungary. Most of these are regional papers, which are essential for the Orbán propaganda machine. Relatively few people subscribe to national newspapers anymore. Népszabadság, before it was shut down, had the largest circulation, which by 2016 was only around 40,000. On the other hand, regional papers are sold in great numbers. Propaganda through these newspapers reaches far more people than propaganda placed in the few nationwide dailies.

The real bonus of these papers from the government’s point of view is not so much what they report on but what they leave out. A few days ago I read a fascinating study of a week’s worth of “non-news” in regional papers about the demonstrations in Budapest and some other cities. That’s why I was surprised to learn from Medián’s latest poll that people outside of Budapest were well informed about recent events in connection with the government’s attempt to close Central European University.

Outside observers might be horrified at the overwhelming presence of pro-government media in Hungary, but the government is still not satisfied. I understand that Mészáros’s company would like to acquire the few remaining regional papers that are owned by companies not connected to the government. Origo, once one of the two best internet news sites, has become a servile mouthpiece of the Orbán government rivaling Magyar Idők. Mária Schmidt’s acquisition of Figyelő is another sign of the insatiable appetite of the Orbán government. They even made an attempt to grab Népszava, which was eventually saved in the last minute by László Puch, the former financial director of MSZP. The government wants to have all the media under its control, just like in the good old days of János Kádár.

Apparently Orbán’s next victim was to be Index, considered by many to be the crown jewel of Hungarian-language internet news sites. But 444.hu reported a few days ago that in February 2014 Lajos Simicska, who became Viktor Orbán’s archenemy after March 2015, signed an agreement with Zoltán Spéder, the owner of Index, which stipulated that in the event Spéder decided to sell the site Simicska would have the right of first refusal. Simicska took advantage of this agreement on April 20, 2017, apparently in the nick of time because Orbán, through Árpád Habony and Mária Schmidt, had for some time been pressuring Spéder to sell Index. Simicska will not personally own Index. He transferred ownership of the site to a newly established foundation called Magyar Fejlődésért Alapítvány (Foundation for Hungarian Development), headed by László Bodolai, lawyer for both Lajos Simicska and Index. Without this move, Index would undoubtedly have been gobbled up by the Orbán government or one of its surrogates.

The reaction in the government media to the sale of Index was predictable. In the last couple of days one article after another has bemoaned the loss of Index. What is especially galling is that it was Simicska who prevented the takeover of the internet site. Well, it’s too late for the government to gain control of Index, but it has many ways of discriminating against the site. Independent organs normally don’t receive any advertising income from the government or from state-owned companies, but papers and television stations owned by Simicska are subject to additional hardships. One standard government ploy is that government officials are forbidden to give interviews to Simicska’s Magyar Nemzet and HírTV. Fidesz did the same thing while in opposition, when its politicians were forbidden to appear on Napkelte (Sunrise), an independently produced program Orbán deemed to be too liberal and antagonistic toward Fidesz.

Zoltán Balog has been leading the troops against Magyar Nemzet and HírTV. Simicska treated his brother-in-arms (bajtárs) shabbily, so Balog first announced that he and his ministry will refuse to have anything to do with Simicska’s media empire. Although Balog was aware that the law on public information forbids such discrimination, that didn’t seem to bother him. Moreover, that wasn’t punitive enough for Balog. By December 2016 all employees of institutions under the ministry of human resources–for example hospitals–had to get written permission from the ministry to give interviews or make statements about simple facts to anyone. For example, on December 6, 2016 a reporter for Magyar Nemzet wanted to write a heartwarming story about patients in a children’s hospital receiving gifts on St. Nicholas Day. Two hours before the event she received a telephone call from the hospital saying that she needs written permission to attend. Permission was denied. Not surprisingly, the reporter for MTI, the official news agency, had no trouble receiving permission. I assume that the legal problem of discriminating against certain media outlets and not others is supposed to be solved by requiring every news organization to obtain the requisite permissions. Meanwhile, the ministry’s boycott of Magyar Nemzet continues. When the paper filed charges against the ministry, Péter Polt’s prosecutor’s office decided that everything was in order.

Now Index has been added to the blacklist. Yesterday Sándor Joób, a well-known reporter at the news site, shared a revealing story. Index has been sending hundreds of requests for information about hospitals, for which the ministry’s permission is required. Joób wanted to talk to an official in charge of the reconstruction of Budapest hospitals. The official was most willing, but he needed permission. By mistake the reporter himself was included among the recipients of the message: “We ask you to refrain from giving this interview.” Magyar Nemzet immediately responded: “Welcome to the Club!”

Journalists at independent or opposition media outlets work under extremely difficult circumstances. For instance, Fidesz members of parliament refuse to answer any of their questions, and just the other day Lajos Kósa, head of the Fidesz parliamentary delegation, called reporters hyenas. Under these circumstances one can only admire the commitment of the journalists working for Magyar Nemzet and Index as well as other outlets like 24.hu, 444.hu, and Népszava. These journalists work for low wages and their job security is nonexistent. I just read about the former editor-in-chief of Dunántúli Napló, a regional paper in Pécs with a large circulation. After Lőrinc Mészáros’s Mediaworks took over the old Pécs standby, he lost his job. Now he is selling sausages as a street vendor.

May 4, 2017

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

OLIGARCHS COME, OLIGARCHS GO

EU money is not the only thing that comes and goes in Hungary. Oligarchs come and go as well.

A few years ago Zoltán Spéder, a banker who is among the thirty richest men in Hungary, was given the red carpet treatment. Even laws were changed to make his business activities easier. Today a full-scale character assassination is underway against him, and the police have already searched his bank and his media company that is behind the successful, informative online news site Index.

Spéder seems to be the kind of fellow who tries to get along with people in power without paying much attention to ideology. For example, as head of FHB Mortgage Bank he maintained good relations with András Simor, chairman of the Hungarian National Bank at the time, and worked together with Prime Minister Gordon Bajnai. Nonetheless, he is considered to be close to Fidesz, whose leadership he got to know well in the early 1990s when Spéder was still part of the upper management of OTP, Hungary’s largest bank. After 2010 the successful banker, by this time heading FHB Mortgage Bank, was chosen by Viktor Orbán to head a bank in which the state had a majority stake that was intended to compete with OTP. The vehicle for this scheme was the forcible integration of a number of independent credit unions headed by Spéder. The story of “the rape of Takarékbank” can be read in English in Budapest Beacon.

So, a couple of years ago Zoltán Spéder was the darling of the government, the key man in a new state-owned bank that was meant to have a much larger share of the market than any privately-owned commercial bank in the country. Well, this plan has been abandoned, and I wouldn’t be at all be surprised if Spéder were soon in custody.

The business partners

The business partners

First, the new government-financed tabloids, 888 and Ripost, followed by Andy Vajna’s TV2 in the service of the government, began a witch hunt against the man. The second move was a change in the law, taking away Spéder’s special status. Third, NAV, the Hungarian tax office, is investigating Spéder. And finally, yesterday police arrived at the offices of Spéder’s bank and media company and took away computers and other evidence.

The pro-government media’s attacks on individuals and institutions are obviously ordered from above because they move more or less in unison. For example, the very first issue of Árpád Habony’s new free paper Lokál had an article: “Who is this Zoltán Spéder and what does he want with our money?” Ripost published pictures of Spéder in baggy shorts talking with an unidentified man and a well-known businesswoman on a city street, arriving at the absurdly primitive conclusion that Spéder is down and out, a man who has to conduct his business on the street. TV2 did a number on him in the series introduced a week ago “Billionaires in Hiding.” If you recall, George Soros was the first victim. Spéder has the distinction of being number two on the hit list. The “revelations” were mundane: he has a swimming pool, a tennis court, and expensive cars. The program mentioned his “political connections” but wisely remained silent about who the politicians are with whom Spéder is so friendly. “He robs you if he likes you, he robs you if he doesn’t like you because he must always win,” the anchor of the program said.

Character assassination is a specialty of Viktor Orbán. 444 calls it a vendetta. And naturally FHB’s shares plummeted. On Monday it opened at 702 forints. Thursday’s closing print was 540 forints. Since the Hungarian state owns 4.8 million shares in Spéder’s bank, Hungarian taxpayers lost 783 million forints in the last few days thanks to Viktor Orbán’s action against Spéder.

Commentators are trying to find the real reason for the massive, concerted attack on Spéder. There are different hypotheses. (1) Spéder and/or Index offended Viktor Orbán, György Matolcsy, or both. (2) Orbán as early as January was angered by Spéder’s capital raise for FHB via a private placement, which reduced the state’s share in the bank to 40%. The prime minister in one of his radio interviews called it “an unfriendly, not to say, hostile move” that Spéder must rectify. And there are some other theories that are too bizarre for serious consideration.

Until now, commentators have spent little time assessing the role the journalistic activities of Index might have played in Viktor Orbán’s ire against Spéder. On April 28 Index reported that, according to the paper’s sources, TEK, Viktor Orbán’s anti-terrorist force, was sent to Uganda to bring Orbán’s son home “when it turned out that he had joined a Christian group doing charity work in Africa.” A few hours later Index had to retract the story after it turned out that it was not true. Since then the investigative journalist who was responsible for the article left Index and is now employed by Népszabadság. Of course, this wasn’t the only story that appeared in Index that annoyed Orbán and the people around him. The publication in general is sharply critical of the Orbán government’s less than sterling performance and its incredible corruptness.

According to W. Árpád Tóta, my favorite commentator who worked for Index a few years ago, before 2010, that is before Fidesz won the election, Spéder had never interfered with the content of articles that appeared in Index. Sometime after 2010, however, he approached Tóta and tried to convince him to tone down his criticism of Orbán and Co. Tóta immediately left for HVG. But it looks as if Spéder wasn’t aggressive enough in changing the tenor of the paper. In any case, Tóta warns Spéder in an opinion piece titled “Let’s not be friends” that “to have a friendly relation” with the government is totally useless. To be on friendly terms with the government in Hungary means to be friendly with Orbán, but friendship involves a give-and-take relationship. And Orbán is incapable of any relationship that is not based on total subordination. It is worthless, Tóta argues, to court the man in hope of his goodwill. The policy of appeasement doesn’t work with Viktor Orbán, there is no friendship with a tyrannosaurus.

Finally, Tóta gives some advice to the oligarchs who made the mistake of trying to have a friendly pact with Viktor Orbán. “You can find many good places for the money that you have snatched over the years in no small measure thanks to this false friendship.” In brief, hide your money abroad somewhere and keep thinking of how to get rid of Viktor Orbán. I’m afraid in Spéder’s case this option is no longer available.

June 10, 2016