Orbán
Page 17
All this, of course, goes well beyond the hyperactive Mészáros. A whole line-up of entrepreneurs, above all those close to the prime minister, is building lavish and expensive football stadia in the towns where their largest factories are located. Sooner or later they profit from large public contracts. The president of the Hungarian Football Association, for example, is Sándor Csányi, chairman of Hungary’s biggest bank and for years the absolute number one on the list of the richest people in Hungary. The seating arrangements and facial expressions of the entrepreneurs and Fidesz politicians sat with Orbán in the VIP lounge for a football match in Felcsút or neighbouring Székesfehérvár are watched and analysed almost as carefully as János Kádár’s favourites in the past, at a hunt or on the May Day parade tribune in Budapest.
Orbán is often to be seen in the company of the particularly successful businessman István Garancsi, owner of the Videoton football club from Székesfehérvár. According to media reports, the fifty-year-old former broker has also achieved his position as a close confidant of the prime minister through their common passion for football. In 2015 alone his real estate and construction companies received public contracts worth more than €150 million. Garancsi landed in the headlines at the end of 2015, when it was reported that between 2011 and 2014 the state-owned energy company MVM had bought gas from the Hungaro–Russian MET Group (registered in Switzerland) at a higher price than from its Western partners. MET, in which Garancsi has a 10 per cent shareholding, made a profit of at least €70 million on this deal. At the beginning of 2016, his company was able to launch a huge real estate project in Budapest with a €55 million credit from the state-owned Eximbank. It is no wonder that this football and Orbán enthusiast has, since Fidesz took office in 2010, been able to almost triple his fortune to €80 million, rising on the list of most influential Hungarians from fourteenth to eighth place.9
Garancsi is not the only entrepreneur or Fidesz politician pushing the construction of stadia in small provincial towns following the example of Felcsút. Yet, in spite of the enormous investment, the number of spectators has not grown in recent years. On the other hand, opinion pollsters note that the government and, without doubt, Orbán personally have been able to profit from the recent international successes of Hungarian football. In 2016, for the first time in forty-four years, the Hungarian national team not only qualified for the European Championship but also reached the last sixteen as undefeated group leaders. Despite then losing against Belgium, the team was given a triumphant reception at Heroes’ Square upon their return to Budapest.
Whilst on the subject of Felcsút, one more story should be mentioned: the reconstruction of a 6-kilometre-long narrow gauge railway with subsidies worth €2 million from the EU. On 1 May 2016 Orbán rode with Mayor Mészáros on the relaunched train from the restored station in Felcsút to the park with its arboretum in the neighbouring village of Alcsútdoboz. For the project, built of course by one of the mayor’s companies, the state provided a further €1 million. The journey between the three stations takes about twenty-five minutes. At the reopening Orbán said that as a child he had always dreamed of working a hand-operated draisine. He rejected any criticism of this tourist project as pure cynicism, and then announced the extension of the railway to the nearby small town of Bicske by 2019.10
In any analysis of the beneficiaries of the Orbán regime and the social consequences of this cronyism, it is the overall dimension of the corruption, and not just the individual cases blown up by the media, that must be taken into consideration. In the reports about the richest people in Hungary, a correspondent on the online portal 444.hu noted that, of the hundred persons on the list, one in seven is associated with the Fidesz regime. These forint billionaires have been able to amass their fortunes considerably more quickly than average. This ‘unreal sphere’ (Napi.hu) of the rich means that these people have primarily become wealthy not through competition but thanks to winning tenders, to state auctions and, in fact, to not having any real competition at all. It has been calculated that more than half of the credits granted by the state Export-Import Bank have flowed in the direction of pro-government companies.11
Claims that the awarding of these large public contracts may be seen as the equivalent of legal theft have been corroborated by an investigation of the Research Centre for Corruption, an NGO in Budapest.12 120,000 contracts were concluded with government bodies between 2009 and 2015. The result: in the case of 25 to 40 per cent of public tenders (depending on the year), only one offer was received, meaning the bidder won automatically; approximately 62 per cent of public contracts were awarded without any official announcement—that is, only those who had been informed in advance by the tender issuing body could participate, rendering impossible any open competition; in the tenders for projects financed with EU money (approximately 60 per cent of the total) the risk of corruption was much greater, sometimes reaching 80 to 90 per cent of cases.
However, it must be strongly emphasised that the corruption prevalent in daily life, in the economy and in society is in no way a product of the Orbán era. Numerous great novels, famous films and plays by Hungarian authors from the nineteenth century onwards have dealt with the deeply rooted traditions and varied practices of bribery, nepotism and moral collapse in Hungary. Scholarly investigations and contemporary works alike point out that the roots in part go back to the time of the Turkish occupation,13 but above all to the early years of the Dual Monarchy following the Compromise of 1867.14 The results of comparative surveys show that in Hungary 30 per cent of those questioned would report a case of corruption to the authorities; in Germany and the UK this figure rises to about 90 per cent, and even in Romania it is 59 per cent. Hungary’s position on Transparency International’s Corruption Perceptions Index has consistently worsened, slipping seven places to fiftieth of 176 countries (surpassed only by Bulgaria in the region), while the country finds itself in an especially lowly position on the OECD index on corruption in government departments. It is no wonder that 69 per cent of Hungarians regarded their government as corrupt in 2014.
Researchers point out that corruption in Hungary is now veiled behind a complex system of contracts and organisations; it is also being conducted in a much subtler manner. ‘People see no great difference in whether an investment project costs nine instead of eight billion forints.’ Researchers estimate that inflated invoices amount annually to €1.3 billion.15 Many opponents of the regime are amazed that the flood of reports on the corrupt cronyism of Fidesz people has not had any serious impact on the party’s popularity in opinion polls. Yet, ironically, in 2010 it was the allegations of bribery made against the Socialists that contributed significantly to Fidesz’s victory. This allows its supporters to console themselves with the fact that ‘the Socialists also stole, those [in power] today do it too, but at least we now have a true national government and a strong leader’.16 The silence in the state and Fidesz-controlled media about the most explosive cases is also an important factor. However, we must also recognise the positive consequences of the recent metamorphosis of Simicska’s newspapers and radio stations into critics of the Orbán regime. Some of the juiciest corruption stories, including those about Orbán’s own family, were first reported in Magyar Nemzet or on HírTV, once blindly loyal to the government.17
The sobering reality that, after seven years in office, wide sections of society are not alienated by the Orbán regime or outraged by the corruption scandals it tolerates, that people are not turning significantly against the governing party, may largely be ascribed to the fact that Socialist politicians are still very much compromised. It is an irony of fate that to date in Hungary only functionaries of the Socialist Party, which lost office in 2010, have been named in the Panama Papers.18 The former chief financial officer of the party, László Boldvai, was for example the first active Hungarian politician forced to admit to the existence of an undeclared company abroad, as well as a bank account in Switzerland held under his wife’s name.
As Socialist Party treasurer he had already been involved in a huge bribery scandal in 1996. There was particular indignation at the report that this owner of a luxury villa and other real estate, not to speak of a number of expensive cars, had taken part in a ‘hunger march’ for minimum wage earners organised by his regional party executive. Moreover, the party chairman (replaced in June 2016) had asked him to help in cleaning up the financial affairs of the party. His influential successor as financial officer, László Puch—said for years to be a symbol of internal party corruption—has been indicted as the holder of an account worth millions in a Viennese bank. In the meantime he has been able to pay, out of unknown sources, back taxes amounting to €300,000. In June 2016 a new Socialist Party chair was elected after unsavoury intrigues and public squabbles, a man who was also involved in several financial criminal proceedings—though he was ultimately acquitted of them all.
There are more than enough indications that the mutually beneficial cooperation between the Socialist and Fidesz financial chiefs dates back a very long way. As Orbán’s biographer József Debreczeni put it in 2011, the only difference between the two parties in their conversion of public assets into private ones lay in the fact that Fidesz was much the better organised. Quite correctly, a scandalised reader of Népszabadság wrote after the revelations about Boldvai that, next to Fidesz figures, the Socialists were amateurs when it came to corruption.19 In the meantime, the breathtaking financial careers of Mészáros, Vajna, Garancsi and the rest of Orbán’s cronies and proxies confirm assessments by critical observers that Hungary has moved onto a qualitatively higher plane of state and personal corruption since Fidesz’s seizure of executive power in 2010.
17
HUNGARY’S ‘FÜHRER DEMOCRACY’
After seven continuous years of Fidesz rule and in light of all opinion polls, even Viktor Orbán’s fiercest critics concede that at the age of fifty-three his position appears impregnable. His unlimited personal power is virtually unchallenged within Hungary, nor is it under threat from the EU. In an essay published to mark the halfway point of the 2014–18 Orbán government, the legal scholar Tamás Sárközy speaks of a
government of what has become a permanent national liberation struggle … It is not a conservative Christian Democratic government but a politically very successful radical half-bourgeois administration governing right and left of the centre, headed by parvenus, ambitious upstarts of the first generation, who govern on the one hand with semi-feudal patriarchal, partisan order elements; and on the other, with post-modern tendencies, often aligned with the much reviled globalisation. At the heart of this regime, devoted almost exclusively to power politics, has stood since 2014 the retention of power at any price.1
What could be described as the nationalisation of politics in the face of an almost paralysed civil society has at its centre a de facto presidential and centralised government, with Viktor Orbán as its sole and arbitrary head. The number of ministers has remained unaltered at eight since 2010, but that of secretaries of state has mushroomed to fifty and of deputy secretaries of state to over 100, many of whom are at one and the same time MPs. The approximately fifty government commissars should also not be forgotten. Though Zsolt Semjén, the leader of Orbán’s small coalition partner, the sixteen-MP-strong Christian Democratic People’s Party (KDNP), is the (nominal) deputy prime minister, more than ever the actual centre of power is the Prime Minister’s Office with its eleven secretaries of state, eighteen deputy secretaries of state, approximately two dozen commissars and altogether 800 civil servants. The executive minister is János Lázár, forty-two, the former head of the Fidesz parliamentary group, who at the time of writing (2017) is regarded as the regime’s number two. However, in the autumn of 2015, Orbán made Anton Rogán, forty-five, another former parliamentary party leader, his chef de cabinet with the rank of minister. Rogán, number seven on the list of most influential Hungarians, is seen by the media as Lázár’s rival.
One of the more bizarre features of the Orbán regime is that political reporting in the media primarily revolves around gossip or leaked information about supposed or real power struggles and intrigues in the court of the supreme leader. These rumours have spread especially since Rogán was installed as a minister with four secretaries of state, two deputy secretaries of state and his own bureaucratic machine in the Prime Minister’s Office; he is now ranked equal with Lázár and answerable only to Orbán. Though Rogán retains the prime minister’s backing, a spate of press reports in the autumn of 2016 about his alleged abuse of power seriously undermined his reputation. A few months previously, in July 2016, Orbán carried out a surgical division of the government into a strategic cabinet, headed by János Lázár, and an economic cabinet, chaired by finance minister Mihály Varga. This has been regarded as a major step towards a semi-presidential system, which, through the appointment of three commissioners responsible only to Orbán, curtails the competences of the executive minister Lázár, particularly with regard to the supervision of key financial institutions.
László Lengyel, who has an intimate knowledge of the career of Hungary’s ‘strongman’, suggests that Orbán, basing himself loosely on the ideas of Carl Schmitt,2 wants to have the right and power to decide who is a friend and who is a foe. Lengyel believes that Orbán accepts the fundamental precepts of Schmitt, whereby the person who decides on a state of emergency is sovereign, and concludes:
Both in his domestic and foreign policy [Orbán] suspends the liberal democratic institutions, principles and relevant practices in order to build up his illiberal/autocratic system based on unity against the enemies of the nation, on the Führer principle, on autocratic authority, on the basis of a permanent state of emergency and political legislation, and in order to spread this model internationally.3
Speculation flourishes not only in the media but also among the opposition about the methods and relative strengths of the rival cliques in Orbán’s court, about their respective options and aims, and also about the shifts in the personality of the vezér. This translates literally as the supreme leader or Führer. It is also how Orbán is obliquely but frequently referred to by critical analysts and commentators in independent publications.
In a discussion on the phenomenon of Viktor Orbán and his government hosted by the left-wing monthly Mozgó Világ in Budapest in January 2016, all participants, for example, rejected the claim of a well-known psychologist that he would, at most, have trusted the ‘very mediocre’ Orbán with the management of a leather goods warehouse or a sports shop. András Bozóki, founder and editor-in-chief of Magyar Narancs, the first Fidesz newspaper (1989–92) and today Professor of Political Science at the Central European University in Budapest, has emphasised:
… politics is not only a question of education or intellect. Orbán was from the very beginning driven by an astonishing absolute will to win. Not a statesman, but a ‘good politician’, in his understanding of the mechanics of power, of intrigues, of competence, of political instinct and with the ability to keep himself in power for a long time. He has also only been able to achieve this because he has violated the rules and not respected the democratic order. In reality there are only three things in which Viktor Orbán is still truly interested: power, money and football. And in that order. There is no substance, the goal is to stay in power, and that is going well. Slowly, Orbán is following in the footsteps of Kálmán Tisza.4
The successful build-up of a new pro-Fidesz socioeconomic elite with a relatively broad-based clientele in both the central and regional administrations has also been promoted by measures such as the flat income tax rate, child allowances and reductions in gas and electricity prices. The incomes of the upper two deciles of the population grew by 22 per cent between 2010 and 2014. The sledgehammer propaganda proclaiming the successes of the regime has also been facilitated by the close coordination of budgetary and monetary policy, by the stabilisation of the deficit under the 3 per cent level set by the EU, and the repayment of I
MF loans. The fall in unemployment trumpeted by the government is partly due to the fivefold increase in the number of those who receive wages paid by the local or state authorities for so-called community service instead of unemployment benefits. An especially important factor in reducing unemployment is, of course, the fact that between 350,000 and 500,000 people are estimated to have found employment abroad, mostly in Great Britain, Germany and Austria. Their money transfers home have contributed to the improvement of the balance of payments.
The boastful announcement of the controversial governor of the National Bank, György Matolscsy, that on the basis of the economic successes of recent years the ‘historical goal’ (that of overtaking Austria) is realistic within twenty-five years caused a great deal of amusement amongst experts in both Budapest and Vienna. At present, the per capita economic output in Austria is still about double that in Hungary. The Hungarian economy would have to grow annually by 3 per cent more than the Austrian economy just to catch up with its neighbour within twenty-five years. ‘With annual 2-per-cent faster growth this catching up process would take forty years and with 1 per cent it would take seventy!’5 Matolcsy’s prediction reminded a Vienna-based economist of ‘comrade Khrushchev’s announcement in 1959 during a visit to an American exhibition in Moscow that the Soviet Union would catch up with the USA within seven years …’.