Portfolio blogger

Sunday, June 20, 2021

Hungarian conservatives – emerging again?

 New Hungarian conservative parties will be needed once Orbán has disappeared from power but some think they also have a role to play in ousting him. Hungarians are indeed prone to conservativism but like being cared for by the state. The governing party, FIDESz is closest to their general attitude – except its social policies. Its grip on the economy and communications means that it can be defeated only by mobilising the undecided voters. These parties target them and disappointed FIDESz-voters. They sense that the gap which Orbán and his party occupied with success in 1998 and holds since, is opening again.

After FIDESz moved to the right, it won four elections. The traditional left and liberals were fragmented and their bad governance – the country was hard hit by the 2007-2009 crisis as bad management made it vulnerable – also harmed their credibility. Surveys show that undecided voters are more conservative.

This makes it plausible that the force able to replace FIDESz needs the rightwing. Most of these movements and parties cannot yet gain a lot of publicity, the press only rarely reports about them positively. Exceptions are, however, accumulating.

In 2015 Zoltán Kész, an ex-member of FIDESz won the 2015 by-elections in Veszprém, vacated by a local strongman of FIDESz. Next, another disappointed FIDESz-member, Péter Márki-Zay won a mayoral by-election in 2018, in Hódmezővásárhely, another fiefdom of FIDESz. When Márki-Zay founded first a movement, then a party named “Hungary of all”, Mr Kész joined the board. Other members of the board are also known and valued both by the voters of the opposition and the right-wing.

The founder of Új kezdet, (“New start”) is a well known conservative but he resigned to lead his municipality. The president is MP of LMP, a leftist-green party, whose faction is called the joint faction of LMP and of “New Start”. A vice president is independent, another one was member of the leadership of the liberal SzDSz during its eclipse.

The “New world popular party -2022” of a past FIDESZ minister and president of the Academy of Sciences, József Pálinkás started with a professional image (the movement itself was also called “Responsible Professionals”). They appear sometimes in the press – signalling also Pálinkás’ ability to break the wall of silence mentioned. The health expert of the party, who really managed a hospital, is also often invited in the context of the pandemic to independent media. Their team features two prominent foreign policy experts and runs a blog with expert contributors.

Peter Márki-Zay and József Pálinkás are candidates of the primaries in preparation of the 2022 national elections for prime minister. Whether they win or lose, their parties and “New Start” may re-create European conservativism in Hungary. A look at their programmes shows what we can expect from them.

Two of these parties (“Hungary of all” and “New start”) formulate their vision in twelve points (the young revolutionaries of the emblematic 1848 revolution and war of independence also formulated their demands in 12 points). All three aim to correct the distortions of the FIDESz rule – rule of law, fair and equitable laws, reinstallation of democratic institutions, the “New world” even outlined a short term crisis management programme separately from the long term vision. Each wants to stop corruption and join the European Prosecutor’s Office. “New world” and “Hungary of all” expressly mention joining the Eurozone.

Supporting Hungarian minorities in their endeavour to gain their rights within their country is prominent for “New start” and “New world” while “Hungary of all” wants them to be proud of a successful Hungary. “New world” also wants the EU to protect minorities. All three want to make it worth for Hungarians working abroad to come home.

In terms of law and political structures, “New start” emphasises the freedom of civil society and religious communities, “Hungary of all” the freedom of the press while “New world” argues for autonomous institutions and a smaller state. Publishing the files of secret agents of the communist regime is part of the programme of “Hungary of all”.

Economically, while promising fair competition, “New world” wants more EU funds for SMEs, as in their view, large companies are advantaged more than their added value would justify. “Hungary of all” sets on a strong competition authority and calculable environment. “New start” would reform the system of communal work for the jobless and would introduce basic revenue for social integration and social contributions based on needs (including social housing), while “New world” would prolong jobless support, which is extremely short now. Thus, all envisage some state role – even the least “dirigiste” “New world”.

“New start” is the only one to mention abolishing the single key tax system (a controversial topic).

Development of the countryside (including providing schools with local produces) is important for “New world” while “New start” emphasises the importance of local authorities. Sustainability takes an important place in the programmes of “New world” and “New start”.

Education and health are prominent in all programmes with a significant role of the state. “New world” strives for digitisation and spending comparable to leading countries.

As European conservatives have to clarify their attitude to Hungary, they should not forget the real conservatives there. Many of Hungarian voters are waiting for it.

Monday, April 20, 2020


Complaining about double standards is the Swiss army knife of those who do not observe standards. Judit Varga, Minister of Justice of Hungary complains in the title and the last sentence of her article on Politico about double standards in judging the emergency bill recently voted by the Hungarian Parliament. The article itself, however, just wants to explain that the critics did not read (or at least misunderstood) the bill.
As Politico did not react to this although it also sheds bad light on their coverage - they did not accept my reaction, I react to it here.
There are several misrepresentations in the article: first, double standards mean mainly judging equals by different measures. The measure the critics use, is, however not different: it is whether the action is necessary and proportional in a democratic society. If it is not necessary, proportionality is not a question any more. The government already took the main measures before the bill was voted and the Act CLIV of 1997 on Health
 and the Government Decree 521/2013. (XII. 30.) about Health Emergency Situations enable taking all necessary measures without emergency state. The bill is also not about prolonging the effect of the emergency decrees of the government but gives the right to take measures in the future. By the way, FIDESz was able several times to pass laws within a couple of days so nothing would prevent them from enacting the measures in law. An example: the Academy of Sciences had 45 minutes (!) to comment on a draft bill taking all research institutes away from them.
Parliamentary (and constitutional) control is the weak point of arguments on the other side, too. FIDESz has two thirds which was only not enough to approve the bill immediately, the two-thirds were sufficient to vote it in urgency. The Constitutional Court consist also only of partisans of the ruling party. Therefore too much cannot be expected from them – so why insists the opposition on it? Simply because debates in Parliament and cases before the Constitutional Court get more publicity while government decrees can be kept secret.

The proposed amendment of the Criminal Code has to be read in conjunction with the present rules on sanctioning spreading of scaring rumours. The difference is only that the prison sentence can be two years longer and the formulation of presenting true facts in a false light is wider, giving more marge of manoeuvre to the authorities (two procedures have already started, both against mayors of the opposition for warning that the virus is already in their community).
Another test can be to see what others do. Just one example: in the interview with German TV, Wolfgang Schäuble found the most important to mention that the emergency situation is limited in time and its prolongation has to be approved by Parliament every time.
Finally, avoiding double standards also means judging those who differ with a different measure. Ms Varga would deny it with all her force but there are a lot of examples where the Hungarian government abuses its powers. Although hardly any refugees arrive to the Hungarian boarder (and even less can then pass) the emergency due to refugees is still in force in Hungary. Ms Varga warns from fighting against imaginary enemies when there is a real one. Hungary's government spent the last ten years fighting against imaginary enemies (Soros, the CEU, migrants - they are real but no enemy, etc.) and now, facing a real enemy, wants to use the very same methods. One morning the prime minister announces that there is no need to close schools, the same evening orders to close them. One day the chief physician announces that masks are useless, two days later the prime minister says they are not compulsory only as there is not enough and he himself made one at home - this after the 27th February the Minister for Human Resources (also responsible for health - maybe the name reflects that they run the country as if it were their own enterprise) and then several times the prime minister announced that there is enough material available. And they refused to re-group money from propaganda to health care (propaganda, as opposed to health, has an own ministry).
Articles written by ministers will scare supporters away, but not the virus.

Saturday, March 28, 2020

Europe as digital champion - at what price?


Mark Scott might be right (Europe is fighting tech battle with one hand tied behind its back), European rules may not  create the best climate for all-encompassing digital powers. At first glance, there are also simple answers at hand:  do we want to tolerate a chinese-type surveillance state or adopt an american-type business-is-all-that-counts mindset to be digital champions? Can we, on the other hand, exclude Chinese (think Huawei) or U.S. (Google knows it all, Amazon sells it all, etc.) giants and be digital champions only for ourselves, playing by our own rules? The success of European rules also over Facebook and the like - enter Maximian Schrems - means that we enjoy what these companies developed on the back of the citizens of their countries but we are not able to conquer their lands.
To give a more balanced answer, we need to step one step back. Of course data are not the only force and not the only obstacle (see also in Politico), let us, however, look at them. Data is (or are, if you are less orthodox in language) the new oil, does it say. Power, however, is not in oil but in petrol and petrochemicals. Similarly, the key to real success is what you do with data. Researchers have found ways to link  profile and behavioural data without identifying the persons. One solution is proposed by Accenture, for example. This is more complicated and may be more costly, but can use data of persons in areas outside the U.S. and China, where the example of strict European data protection rules are being followed - South-America, Japan, other parts of Asia and Africa. This is a huge potential which we may lose if we just imitate and do not create our own models.

Saturday, May 26, 2018

How to deal with "illiberal" corruption?

Two issues keep the debate around the new Multiannual Financial Framework (MFF) going: one is about how to find a mechanism to react to governments which do not comply with the Copenhagen Criteria, i.e. infringe democratic and/or rule of law principles (the infringement of democratic principles is more indirect as the sheer outcome of elections favours the governments of Hungary and Poland - although in Poland the tide may turn - but the circumstances under which these governments win the votes are at least dubious) without resorting to the famous (or rather notorious) Article 7, which is rightly called the "nuclear option" as it is very strong and virtually impossible to implement. It has to be noted also that this "nuclear option" is not directly so nuclear as it strips a country from its voting rights but leaves all other right untouched - of course after this the other member states can vote other sanctions if they are in line with general law.
The other question is also raised in the context of the projects in Hungary where the government is distributing EU funds with an extreme speed - leading to suboptimal decisions in itself - and favours its cronies in this distribution.
As it seems that - at least in Hungary - these two negative phenomena go hand in hand - and the concentration of power and hollowing out of all checks and balances really ensures that cronyism and corruption cannot be brought to court or hindered any other way, including wide publicity, the two questions are mixed together.
Proposals are tabled which would make EU funds conditional on rule of law criteria. In terms of proper use and avoidance of fraud, joining the European Prosecutor's Office is favoured. On the other hand, soon a new Financial Regulation will be voted which will simplify the disbursement of EU funds.
EU structural funds are an important source of economic development, a positive factor in the image of the EU and also help cohesion between the countries (also by enabling that their economic development approaches them to each-other - they are also called cohesion funds). I totally agree with Markko Markkula, president of the (European) Committee of the Regions, who emphasised the importance of these funds in an interview already serving as a preparation to the fight around the new MFF, arguing that the cohesion funds should not be cut. A recent article (and one of a leading Hungarian commentator who can also not be suspected of being on the side of the present Hungarian government, arguing that austerity will not break the government of Orbán) warns that the cut of funds can be counterproductive.
So what?
My proposition is that the decisions (including acceptance of projects and procurement) should be more centralised and also more controls should be applied, covering the cost of these from the funds made available to the country in question. These controls should also depend on whether the coutry joins the European Prosecutors' Office.
This would of course require additional resources which is always difficult to achieve but even more difficult now when EU sources are decreasing due to the Brexit. Therefore the structural funds should be used for this purpose. This would not be such a sensitive cut as what is proposed in the framework of the new "conditionality" proposals. Also, joining the European Prosecutor's Office should be the precondition of applying the simplifications in the new Financial Regulation.

Thursday, April 19, 2018

Some wider aspects of the Selmayr nomination


What is the outcry against - not the nomination itself but - the way Martin Selmayr was nominated to the position of the Secretary General of the European Commission? His personality and ways certainly play a role but everybody agrees, at least publicly, that he is suitable for the post. He gained both acclaim and enmity not just as a devote European (what is not always the way to please member state representatives) but also as an efficient or rather effective operator, who could be ruthless and manipulative at times. Politically speaking, however, his power will be more moderate while he is expected to shake up the apparatus of the Commission. Some parts and ways of it are namely too slow and too bureaucratic. This will no doubt benefit the EU as a whole but can also strengthen the position of the Commission in the sensitive balance between the three main institutions, the Council, the Parliament and the Commission.
Surprisingly after that, everybody talks only about the procedure, not the person. Heads of cabinet were parachuted to director and director general positions already several times (including the head or cabinet of the previous president of the Commission, Barroso). The trade unions always loudly complained every time this occured but this never hit the threshold of attention of anybody outside the Commission.
Apart from this concrete case, deeper unclarities are reflected in the debate. The general rule in the EU public service is that a post has to be filled by competition when a person is promoted into it. Moving officials or even managers "horizontally" can be done directly. Members and heads of cabinets of commissioners (as opposed to assistants of MEPs) are officials. They have, however, a political role and their direct nomination to senior management posts (director and director general) suggests that their seniority is higher than that of other officials commanding a team of comparable size. If these assumptions hold, the only complaint could be about the timing and the secrecy - which hollowed out the nomination right of the Commission as a body given the importance of the position. Leaving that aside, there are two questions concerning the justification of the above way of nomination: the equivalence of a cabinet post to another management post and then nomination of persons in a similar grade without competition.
Let me first mention a case for the "parachuting" of cabinet members and heads. Not nly Commissioners but also judges of the  European Court of Justice and members of the Court of Auditors are delegated by the member states and their mandates expire in different points of time. One new candidate declared already before the nomination to want to bring totally new own staff and thus alo members of the cabinet would lose their jobs. As members of the cabinet are public servants, their job security has to be maintained and there is no reason why they should be forced to accept a position junior to their previous one, by the way, this would be a waste of their talent and experience. A competition in this case would just mean insecurity for them and then further search.
Should cabinet members and heads be public servants? They need to navigate not only the political arena but also the organisation and experience and knowledge of this organisation is a significant asset as well as the knowledge acquired in a cabinet is for the organisation when they return to it. Their status can ensure professionality, objectivity and also continuity. On the other hand the basic question is how their status has or has not to be influenced by tue Commission becoming more political. This change as declared by president Juncker when he came in but the Council and the Parliament neither approved nor disapproved this. When they don't want to treat the cabinets as public service but as a political team, they mqy subscribe to a politicisatin of the Commission to a degree even Juncker didn't foresee.
The other question concerns nomination policies and competition. Here the first argument would be that even when Selmayr is the best person for the job, he didn't get the chance to demonstrate it. And this is the case for all nominations of a person of the grade ofmthe new position. I can see only one argument in favour: this makes compulsory mobility (which can be subject of a separate discussion but let's take it as granted) of management staff. In a lot of commercial organisations there is another case of nomination which is not subject to competition: the nomination of the immediate number two, like the deputy. Peters principle aside, there are a number of cases where the person has demonstrated sufficient knowledge and capabilities to take over and the superiors want to nominate the person. There is an infinitely slim chance that an external candidate can beat the internal one as almost all objective and subjective factors are pointing to the same direction.
Thus, if we want to be coherent, it has to be decided whether cabinet members and heads wre to be treated as officials, what their equvalence to managers is and whether moving "horizontally" without competition is fair and practical. I also propose, however, to consider opening the posibility of nominating the immediate subordinate of a manager without competition. As explained above, the chances of an external to win are minimal and therefore the energy wasted in preparing their application and the wohle selection process could be used  for better purposes.

Sunday, October 22, 2017

Equal pay with locals for posted workers is hypocritical, not helping social justice and economically not rational



Two discussion are going on concerning free movement of people (workers) in the EU: on social support and other allowances to workers and their families (and workers who become jobless) who moved to work from a "poorer" or "lower wage" or "lower cost" country and about the so-called "posted workers", who keep their employment status in their original country but their company moves them to work in another one - also exploiting the difference between wage and price levels. That this is good for consumers by decreasing prices, no one can deny. The plans for reform, howver, are not coherent in these two domains.
While if they have to pay - family and education allowances - governments want to pay less to workers in their countries who have their families in cheaper countries, when others have to pay, i.e. foreign enterprises, they ignore that posted workers do not give up their roots, flats, contacts in their mother countries, they are temporarily in their country of posting. Therefore the slogan "equal pay for equal work", if taken by purchasing power, does not hold.
Who would benefit from the proposed modification? Not the posted workers, they would lose their jobs. The local enterprises would have more demand for their work, this could raise prices. This price increase would not benefit the local workers, if the argument that posted workers harm local industry, holds, as then there would be just a return to normal employment. They would, however, suffer from higher prices as consumers. If the EU wants more social justice, it should favour consumers, not the companies employing them. In particular not one group of companies over another by limiting competition.
Finally, what about the single market? The Services Directive was watered down by the same interests which are at work to amend the posted workers directive, therefore there is no free market in services to protect. Obstacles are in the Directive and in implementation (e.g. administrative difficulties to have qualifications recognised in the “regulated professions”). Therefore I would suggest to Eastern-European governments that when they accept the amendment, they should only do it only for sectors where services are completely liberalised. It would of course help if the Commission would already take these considerations on board when making its proposal.
While writing this, I found the article from Bruegel, a renowned  think tank, titled "EU posted workers: separating fact and fiction". It explains that in 2015, there were around 2 million work postings in the EU, which is 0.65% of the labour force and 0.9% of total employed people in the EU.
This is not an immense threat to employment in the receiving countries but more important for the sending countries (according to the same article, their share in Polish domestic employment is 2.5% but it has to be mentioned that Poland sends out most - almost a quarter of total - posted workers). This share also seems small, but losing their job may be a tragedy for the posted workers themselves and a lethal blow to the companies as well. Thus, to increase employment by fraction of a percent (from the arguments above it follows also that due to the decrease of demand caused by the increase in prices not all posted jobs will be filled with locals, i.e. the "positive" impact will be smaller), lives and companies will be ruined. This does not look like solidarity, which is one of the main values of Europe.