History is repeating itself in Hungary, warns Lajos Bokros

September 28, 2016

“(Orbán receiving Putin in Budapest at the height of the Crimean crisis) only shows how corrupt not only morally but culturally the Hungarian government has become.  It is very interesting to see that Orbán accepted the offer of Vladimir Putin to play a role to try to weaken in every area and respect the cohesion and integrity of the European Union. Orban acts as a fifth column of Russian power within the European Union. As a consequence I can even say that the Orbán regime is a security threat to both NATO and the European Union.” – Lajos Bokros

History is repeating itself in Hungary according to Movement for a Modern Hungary (MoMa) founder Lajos Bokros.

Speaking to the Budapest Beacon this week, Bokros pointed out that “there is a long tradition of xenophobia and nationalism in Hungary,” whose ruling elite “use and abuse the fear of people about the possible loss of Hungarian culture and identity.”  He says the European refugee crisis provides a pretext for the government “to portray itself as the savior of Hungarian-ness.”

A “proportionate answer” to a “pernicious publicity stunt”

Recently, MoMa called on voters to boycott the October 2nd referendum on whether the EU should be able to mandate the settlement of illegal immigrants of Hungary without the consent of parliament.  In this, the small conservative party is cooperating with opposition parties Dialogue for Hungary (PM) and Together (Együtt) on a billboard campaign featuring the image of two people sitting on a couch giving a government anti-settlement quota commercial the middle finger.

"The answer to a stupid question"
“The answer to a stupid question. Whoever stays at home votes for Europe.”

Bokros believes the controversial billboard is a “proportionate answer” to a question he says is awful, pernicious, misleading, and which is “poisoning the minds of the Hungarian people.”

“The referendum question is not relevant because the European Union has no plans to forcibly or otherwise settle illegal migrants in Hungary,” says Bokros, adding that migrants do not wish to come to Hungary because “they have had a tremendously bad experience crossing this country and they know this is not a friendly place [for them].”

He says the referendum is being held “to deflect the attention of society and the nation from the miserable performance of the government,” adding that it is not true that the economy performs well or that people are living better.

The former finance minister claims there has been a “sharp deterioration” in public sector services such as health care and education, and “a general downturn in the living standards of the Hungarian people.”

“It’s important for the government to deflect attention from that,” he says, dismissing the referendum as a “publicity stunt” intended to demonstrate to the EU that the Hungarian government is against the so-called forceful settlement of migrants here.

“Of course the EU knows that this is not the point,” says the former conservative Member of the European Parliament.

Boycott best defense against electoral fraud

Reacting to a joint call by 22 Hungarian NGOs for voters to cast invalid votes by ticking both the “yes” and “No” boxes, Bokros calls their attention to the risk of electoral fraud.

“They can cheat much easier if you participate,” he warns, pointing out that once voters sign their name at the polls. It is easy for those administering the election to swap out their ballot “for a ‘good one’ showing support for the government.”

He also points out that, whereas paper ballots used to have serial numbers, this is no longer the case in Hungary.  As a consequence “even if you deliberately destroy your own ballot, they can replace it with one that is valid, thereby increasing the participation rate.”

Restrictive electoral law

Bokros says “restrictive” electoral law is partially to blame for the fact that less than 40 percent of electoral committees responsible for tallying Sunday’s vote will include opposition delegates. “By law, only parties with parliamentary caucuses can send delegates, which exclude not only extra-parliamentary parties like MoMa, but also parties in parliament without factions. Fidesz is smartly using and abusing the situation that the political opposition is not united in Hungary.”

On Hungary’s “economic miracle”

While acknowledging that Hungary’s financial imbalances have been reduced, Bokros points out “countries which are in need of further investment and capital should not necessarily consider a current account surplus as a positive sign because that means a lack of importation of investment goods.”  He says it “shows that there are no investments in this country” which is “very bad for the future.”

He attributes improvements to Hungary’s fiscal sector to two exogenous factors:

“One is that the EU gives us tremendous subsidies exceeding 3 percent of GDP.  Without these subsidies the fiscal deficit would be more than 6 percent, which would not be considered as sustainable.  The other is the low interest rate environment in all of the world which has enabled the government to greatly reduce the debt service burden.  It helps to reduce the fiscal deficit in a given year.”

On the subject of Hungary’s low unemployment figures, Bokros points out that “the statistical figures are changed in such a way to help the government portray a rosy picture” and that official figures do not consider as part of the active labor force the half million Hungarians who left the country since Fidesz returned to power in 2010.

“These people found jobs in Germany, Austria and in the United Kingdom. Only in these countries is job creation successful.”

Bokos also points out that “if we discount the 300,000 people employed by public work schemes, the employment rate would shoot up.”

The former finance minister says that out of 3.8 or 3.9 million people who are currently employed in Hungary, more than a million are on the public payroll.  He says this is quite high by the standards of “transition economies where the main engine of sustainable growth which creates sustainable income and tax revenues for the state is inevitably the private sector.”

“Private sector employment is low.  Private sector investment is very low.  And as a consequence the state has an overwhelming role in trying to create both investment and jobs and at the same time the illusion of welfare,” says the economist.

On the recovery of the Budapest Stock Exchange (BUX) since being taken over by the National Bank of Hungary (MNB), Bokros points out that the BUX “bounced back from a very low point” but that “if you take a long-term view, the BUX is not performing well.”

The Polish-Hungarian axis

According to Bokros there are now two groups within the Visegrád 4.

“On the one hand you have the Czech Republic and Slovakia which are not fighting a stupid freedom fight against the EU, and which acknowledge that they benefit from the help of the EU and try to play by the rules,” says Bokros, who says Viktor Orbán “failed miserably” at a recent summit in Bratislava, pointing out that “both the prime ministers of Slovakia and Poland publicly distanced themselves from Orban.”

Bokros says that in the eyes of Orbán, the Visegrád 4 has been “reduced to a Polish-Hungarian axis” but that there remain “major discrepancies and divergence of opinion, one of them being Russia.”

He points out that those within Poland’s ruling PiS party “still feel that the number one enemy of Poland is Russia”, which it regards as an “existential threat.”

Bokros says that along with the Baltic states, Poland is the “staunchest ally of NATO when it comes to defense” and “the independence and territorial integrity of Ukraine” which, he says, “is not the case with Orbán.”

Playing with Putin

Bokros accuses Orbán of “playing with Putin,” pointing out that, while forced to go along with sanctions against Russia, Orbán was the first to suggest that the sanctions be removed “which he says is proof that Obán is “de facto on the payroll of Putin.”

“[Orbán’s receiving Putin in Budapest at the height of the Crimean crisis] only shows how corrupt not only morally but culturally the Hungarian government has become.  It is very interesting to see that Orbán accepted the offer of Vladimir Putin to play a role to try to weaken in every area and respect the cohesion and integrity of the European Union. Orbán acts as a fifth column of Russian power within the European Union. As a consequence I can even say that the Orbán regime is a security threat to both NATO and the European Union.”