Hungary’s New and Dangerous Constitution

In the last few months the Western European press was full of news about Hungary. Not the most flattering news. It slowly dawned on people outside of the country that something was wrong with the new Hungarian government that won a landslide electoral victory almost a year ago.

Signs of trouble, at least for those who live in Hungary or those who follow political events in the country, were evident from the very beginning. Prime Minister Viktor Orbán’s Fidesz party, an acronym of sorts for “young democrats,” is neither young nor democratic anymore. Sometime in 1993 the party under the guidance of Orbán, who was then a thirty year-old liberal, edged slowly but surely toward the right. Whether Orbán was always attracted to right-wing ideology or whether he decided to switch sides for political expediency is a topic of debate among political analysts.

Today Fidesz is a nationalist party with a rightist ideology that eerily resembles that of Gyula Gömbös, Hungary’s prime minister between 1932 and 1936.

Gömbös tried to introduce a political system in Hungary that mimicked Benito Mussolini’s fascism. It was only his early death that prevented him from succeeding.

Western readers often find Orbán’s Fidesz described as “conservative” or “right of center.” I would like to correct that wholly inaccurate label. Fidesz under the leadership of Viktor Orbán is moving far to the right.

This week, Adam Michnik, former Polish dissident and chief editor of Gazeta Wyborcza, warned Orbán, his old comrade in arms: “Viktor, this road leads to dictatorship.”

What has happened since the election last April? A lot, unfortunately. Fidesz won 53 percent of the vote but because of the pecularities of the Hungarian electoral system, the party managed to attain over two-thirds of the parliamentary seats. The Fidesz members of parliament were all hand picked by the new prime minister. Potential opponents were set aside. They became members of the European Parliament or were paid off with some lucrative job. Anyone who has since made what Orbán deemed to be a political mistake has been thrown out of the party or demoted.

Under the current Hungarian constitution a party with a two-thirds majority can do practically anything. So Orbán undertook the complete reworking of the Hungarian political system. He put his own men into important “independent” positions including the Accounting Office that supposedly supervises the government’s finances and the Office of the Chief Prosecutor. Right now he is working on doing the same to the Office of the Chief Justice. If he didn’t like a particular ruling of the Constitutional Court, his two-thirds majority voting bloc simply stripped the court of some of its powers. The President’s Office was filled with a man of limited intelligence who is a servile puppet. One could continue.

About all this the outside world knew little until Orbán made the mistake of drafting a media law that would muzzle the written and electronic press. The attack on the freedom of journalists resonated across the world. What is more, Orbán introduced his legislation at the very end of December of last year, mere weeks before Hungary assumed the rotating presidency of the European Union.

Then came two solid months of wrangling over the media law between the European Commission and the Hungarian government. Orbán initially insisted that the would not allow any changes in the law but eventually had to relent. Under European pressure, some changes were made and voted on only recently, but the European Parliament remained dissatisfied. Once again, Hungary has insisted that it will not change a word in the legislation but it might not be the end of the story.

Since the media law was enacted, Fidesz and its ally the Jobbik party have worked on rewriting their country’s constitution. While other opposition parties originally sent delegates to the committee entrusted with drafting the Constitution, it soon became clear that not one of their suggestions would be included in the final draft. They determined, moreover, that their participation could be injurious to their own interests. Let Fidesz with the assistance of the far-right Jobbik come up with a constitution and it will be very difficult to convince the world that it is anything more than a party document that cannot serve the interests of the entire nation.

Fidesz leaders have in recent weeks tried to convince the green liberal LMP to join them in the effort after all. Although LMP can’t always decide whether they hate the socialists or Fidesz more, their leaders refused to budge.

Before 1949 Hungary had no written constitution. The Hungarian legal system functioned very much like that of Great Britain. In 1949, during the Rákosi period, a Hungarian version of the Stalinist Soviet constitution was adopted. With the change of regime in 1989-1990 something had to be done in a hurry. Thus liberal minded constitutional lawyers began rewriting the 1949 document. Their rewrite was so thorough that only a few sentences remained from the Stalinist version. Yet the 1949 date remained. This “oversight” allowed Orbán to claim that the current charter is in fact a communist one.

If one had asked the leaders of Fidesz whether they favored drafting a new constitution from scratch just several years ago, most would probably have said “no.” Orbán himself only complained about the preamble which he didn’t think was dignified enough. But then came the overwhelming electoral victory and Orbán discovered that there was a “revolution in the voting booths.” A revolution that demanded a new foundation.

There was a lot of confusion about when the work on the new constitution should start and how long it would take to draft a new basic law. Orbán at first talked about two years, then one year and suddenly the nation was told that the new constitution had to be done by Easter Monday. This is very much in line with Orbán’s image of himself and his work. A few years ago he borrowed the words of Jesus Christ sending his disciplines forth to spread the faith.

The text of the Constitution was almost entirely written by a single Fidesz parliamentarian whose only knowledge of constitutional law derives from having attended law school with his friend Viktor Orbán.

The preamble, which Fidesz politicians insist on calling “the national creed,” is a verbose and confused account of Hungarian history and a nationalistic wish list for a glorious future. The body of the Constitution still needs a lot of scrutiny but at first glance it seems that this constitution’s importance lies in making sure that the present government and Fidesz can remain in power for at least twelve more years.

A Hungarian political philosopher who is not known for his optimism said that while the old constitution served the country for some twenty years, the new one is unlikely to be around for long. He may well be right. A year after the stunning Fidesz victory, this week, during Hungary’s national holiday celebrating the revolution of 1848, more people demonstrated against the government than listened to Viktor Orbán’s speech telling the European Union to get lost.

For more, read “The first draft of the new Hungarian constitution, Parts I, II and III” at the author’s blog, Hungarian Spectrum.

Hungary’s Rotating EU Presidency Paralyzed

Last week, German chancellor Angela Merkel and French president Nicolas Sarkozy put forth their plans to deepen integration among the seventeen nations that use the euro as their currency.

Hungarian Prime Minister Viktor Orbán described the eight hour luncheon in Brussels where the proposals were discussed as the longest meal in his life, comparable only to his wedding. At the end of that dinner, he added, there were days of celebration though. Surely, at the end of the luncheon in Brussels there was no cause for joy, certainly not for Viktor Orbán.

The Hungarians had worked out a six-point plan that doesn’t speak to the current financial problems connected to the euro. It seems that this plan wasn’t radical enough for Merkel nor Sarkozy. This isn’t surprising given Orbán’s ambivalent attitude toward the European Union in general and his opinion concerning “states rights,” to use a familiar term from American history. The political future of Hungary’s ruling party, Fidesz, largely depends on artificially whipped up nationalism. It would be politically unacceptable at home for Orbán to stand behind a proposal that could take away a substantive amount of economic freedom from the member states.

The Franco-German plan is a radical shift in attitude toward sovereignty in economic and financial matters. If it materializes, it might be an important turning point that could lead to the euro nations’ agreeing on more of their key economic policies as a unified bloc. In return Berlin would strengthen the rescue fund for the eurozone by lending its full €440 billion ceiling figure and perhaps use its funds more flexibly in the future. The problem currently is that there is a single currency without either economic convergence or political union.

Although some member states currently oppose a common tax and wage policy, most observers agree that France and Germany will eventually get their way. For the time being, Austria, Ireland and the Netherlands are complaining, but Ireland’s views in particular don’t carry much weight given the incredible financial mess the country is in.

And what about Hungary? Hungary is not in the eurozone and perhaps many Hungarians at the moment are delighted about the delay in adopting the single currency. Thus, if the Franco-German plan materializes it doesn’t affect Hungary in the short run. However, it has a bearing on Viktor Orbán’s pride and the standing of Hungary which currently occupies the rotating presidency of the European Union.

Hungary’s “ambitious plans,” even before the Franco-German announcement, had suffered some setbacks. It was obvious that at least one item on the Hungarian agenda, the inclusion of Croatia in the union, wasn’t going to materialize given the economic predicaments faced by many existing EU member states. Another, extending the Schengen borders to include Bulgaria and Romania, also seemed to be too much for the European Commission. And now this two-tiered plan.

As Viktor Orbán rather unhappily remarked, the seventeen eurozone countries’ regular meetings will take place in private, most likely meaning that even the prime minister of Hungary will not be present in the next six months. Adding insult to injury, just yesterday Poland was invited to join the meetings as an observer.

Orbán most likely was mighty upset when he arrived in Brussels for the summit. The agenda was suddenly changed and, instead of presenting the Hungarian proposals, he found himself a witness to a long discussion about a new strategy from which Hungary, rotating presidency or not, was excluded. No wonder that Orbán was unhappy.

The importance of the rotating presidency had already been diminished by the appointment of a bona fide president of the European Council a couple of years ago. That limited role has now been further diminished by the announcement of the Franco-German plan that made Hungary’s “ambitious plan” much less relevant.

Viktor Orbán was certainly upset and offended. That’s why he talked about the Franco-German plan as “a nonexistent document.” He tried to mask his disappointment by pointing out that Hungary wouldn’t want to be part of the “elite group” because if the country joined the eurozone any time soon, it might lose its competitive edge by being tied to a common economic and financial policy.

He may be right but the question is whether foreign companies would be eager to establish businesses in Hungary just because of this alleged competitive edge. Extra tax levies and other less than business-friendly burdens currently imposed on foreign enterprises by Orbán’s government are far from conducive to a large influx of foreign capital.

Of course, Hungary can look for business outside of Europe — Russia and the Far East. As for Russia, Hungarian-Russian relations are not the best. It didn’t matter how often Tamás Fellegi, minister of national economic development, went to Moscow, he always came back empty handed. Foreign Minister János Martonyi is the latest visitor to the Russian capital and since he just returned to Budapest, we don’t know yet whether he managed to put Russo-Hungarian relations on an improved track. There has been talk of Russian businesses getting a piece of the action in the Budapest metro construction and the expansion of the Paks Atomic Plant, but no word of major Russian firms planning to set up shop in Hungary. Similarly, there is no news on Chinese investments.

It is unlikely that the sidestepping of Viktor Orbán and the Hungarian rotating presidency by the eurozone heavyweights has anything to do with the less than savory reputation of Orbán and his government in Western Europe. One suspects, however, that he is not the most beloved man in Brussels.

This story first appeared at Hungarian Spectrum, February 8, 2011.

Hungary on the World Stage

Hungarians often complain that the world knows so little about them. Foreigners mix up Budapest with Bucharest. Some people think that Hungarian is a Slavic language. They don’t know that Hungary was a superpower in the fifteenth century. They are ignorant of how Hungary saved Christian Europe from the wrath of the Ottoman Empire. And one could go on and on.

Well, right now Hungarians can’t complain. The country became world famous practically overnight. It took only a few words from Hungarian leaders to weaken the euro and create turmoil in the world’s financial markets. That was no small feat, although I’m not sure whether this is the kind of fame Hungarians dreamed of.

It was just a little over a month ago that a right-wing party, Fidesz, won the elections with an overwhelming majority and gained a two-thirds majority in parliament. The Hungarian constitutional arrangement is such that a party with a two-thirds majority gets almost limitless power. Most prudent politicians would not exploit this power. After all, only 52 percent of the voters cast their votes for Fidesz. The rest voted three ways: on the left, for the socialists and a new green party and on the right for a far-right party called Jobbik which received 17 percent of the votes.

But Fidesz leaders are anything but prudent and they began their activities in parliament with a barrage of legislative proposals that were supposed to turn the existing order upside down. In fact, Viktor Orbán, the new prime minister, called his electoral victory a “revolution.”

Revolutionary fervor is usually not the best foundation for achieving lasting results, especially when the so-called moderate Fidesz is trying to take the wind out of the sails of the far right. Jobbik demands eventual border revisions; the new government approved dual citizenship for those Hungarians who live in the neighboring countries. Since Jobbik‘s preoccupation with the Treaty of Trianon that fixed the current Hungarian borders in 1920 captured the country’s imagination, the government organized a Day of Remembrance on June 4.

The result? Slovakia with a large (over 10 percent) Hungarian minority, mostly living along the current Slovak-Hungarian border, was furious and struck back. Any Slovak citizen who takes advantage of the dual citizenship offered by Budapest will be stripped of his Slovak passport. If the Hungarians are burying their sorrow in memorial days and statues commemorating Trianon, then the Slovaks will erect memorials celebrating their release from Hungarian bondage. Romania has been quiet until now, but trouble is also brewing there. The head of the Senate’s Committee on Foreign Affairs expressed his opinion that the Hungarian government with its new legislation on the “unification of the nation across borders” is questioning the validity of the Treaty of Trianon.

Oh, yes, the world is watching, especially Brussels. If there is anything the world hates, in Europe as well as in the United States, it is quarrels between countries that both belong to NATO and are members of the European Union. They watch with particular suspicion countries situated in Eastern Europe, a region long infamous for its nationalistic disputes. They want stability and cooperation. The new Hungarian government, however, seems to be creating disputes by feeding on the population’s already strong nationalist sentiments.

But the Slovak-Hungarian dispute was nothing in comparison to Viktor Orbán’s economic “master stroke.” A brief background is necessary here. About a year and a half ago Hungary was in terrible financial straits. No one was buying Hungarian bonds and it looked as though there would be a complete financial collapse. But then, Hungary turned to the EU and the International Monetary Fund and received significant loans on favorable terms. In return, Hungary had to promise to introduce an austerity program. This program was so successful that a year and a half later Hungary’s budget deficit has been brought down to below 4 percent.

Hungary remains under the watchful eye of the IMF and the EU. Every four months the Hungarian government must report to the representatives of the two lending institutions. And they are hard taskmasters, especially after the Greek crisis. It was pretty well known unofficially that Hungary would not be able to renegotiate the terms of the loan. But that situation left Viktor Orbán’s government in the lurch. Although the Fidesz politicians were not too specific about their promises, the general impression among voters was that as soon as a new government was formed, the “unnecessary” austerity program would come an end; a stimulus package would be introduced, taxes would be lowered, and the Hungarian economy would suddenly thrive. That is what people voted for in April.

For reasons unknown to most observers, the new Fidesz government simply refused to face the hard fact that the IMF and the EU will not budge. For months they have been talking about “skeletons in the closet,” meaning that the budget figures provided by the former Hungarian government are false. The real deficit is not 3.8 but 7 to 7.5 percent. So it would not be the current government’s fault that they cannot stick to the numbers approved by the IMF and the EU. Of course, this strategy also includes the implicit accusation that those IMF and EU officials who have been checking every item in the Hungarian budget are fools.

And now comes the absolutely incredible move on the part of the Fidesz policymakers. On June 3 about an hour before Viktor Orbán met with José Manuel Barroso, chairman of the European Commission, in Brussels, two high-ranking officials of Fidesz, Lajos Kósa and Mihály Varga, made speeches about the dire state of the Hungarian economy. Kósa, the managing director of Fidesz, used especially strong words, in effect predicting that Hungary would suffer Greece’s fate. Varga, who earlier served as minister of finance in the first Orbán government (1998-2002) and who was charged by Viktor Orbán to “investigate” the wrongdoings of the government of Prime Minister Gordon Bajnai, almost simultaneously with Kósa talked about an actual deficit of 7 to 7.5 percent instead of the 3.8 percent IMF agreed to earlier.

My hunch is that these utterances in Hungary were supposed to help Orbán with his negotiations. It didn’t work. Instead, about half an hour after MTI, the official Hungarian news agency, reported the gist of the two politicians’ utterances, the forint, the Hungarian currency, began to fall precipitously.

The great Fidesz plan failed and policymakers should have immediately backpedaled in order to stop the financial hemorrhaging that affected both the Hungarian economy and international markets. But the charade continued for one more day. Viktor Orbán’s personal spokesman, 24 hours after the beginning of the debacle, repeated Lajos Kósa’s allegations about the country’s bankruptcy and his comparison of Hungary’s situation to that of Greece. And the forint kept weakening, dragging the euro along. This delay is harder to explain than the original blunder. Perhaps the top brass simply couldn’t agree on a face-saving strategy.

Another 24 hours went by before Mihály Varga gave a press conference where he had to admit that Hungary has no choice but to honor the approved 3.8 percent budget deficit. Of course, he stuck to his original story that the budgetary figures are false and therefore the new government will have to introduce further austerity measures. At the same time it was announced that the cabinet will have a three day emergency session during which the government will decide on the steps to be taken. We will find out next week whether Varga’s speech managed to stabilize the currency.

Everybody lost in this game, including Fidesz itself. But perhaps it will slow down Viktor Orbán’s “revolutionary” zeal. Certainly, the first attempts to turn the world upside down failed miserably.