Saturday, March 28, 2020
Europe as digital champion - at what price?
Friday, May 5, 2017
New Eurobarometer survey reveals euroskeptic government propaganda may not influence the attitude of Hungarians to the EU
Saturday, August 10, 2013
Minimum wages in Europe
Wednesday, August 17, 2011
What some recent numbers tell about Hungarian education
Some recent results of the PISA tests also show an interesting picture. Just one graph from the EC press release:
Sunday, July 17, 2011
Hungarian indebtedness
The Hungarian government is proud that it could decrease the debt of the Hungarian state to 77 percent of GDP from 81 percent in a blow (and from about 90 percent where it stood when they took over). The reason: the funds in the private pensions funds were transferred to the state (not put automatically into the state pension fund) and almost half of these funds (4% of GDP) were in government bonds (as for security reasons they had to be by law) which were now eliminated.
Apart from how other assets will be sold, some of these funds were and will be used for current expenditures.
Also, the state purchased (for an amount 80 Bn HUF, a little over 300 Mn EUR more that for how much the previous government wanted to buy it when it was stopped by the then opposition FIDESZ) the share of Surgutneftegas, a Russian company in MOL, the Hungarian oil and gas giant (also active in the region) using deposits from the loan of IMF which was taken but not used by the previous government.
Thus a blog shows that even the gross debt has not really decreased, not to talk about the net debt, which increased to 20,218 billion HUF from 18,104 billion HUF between end of April 2010 and May 2011.
On top of that, although future pension obligations are not in the balance sheet, they exist as people whose private pension participation was transferred to the state, have to get the total of their pension from the state as opposed to a minimum guaranteed amount to which private pension fund members are entitled.
Why is the net debt more important than the gross? If I borrow and the loan is paid to me and I put it into deposit without using it, I increase the gross indebtedness. Until I spend this money, however, I can always use it to repay my debt. Thus, only if I spend it, do I have a real indebtedness.
OK, so why do states keep reserves which increase their indebtedness? Clearly for security reasons: if unexpectedly an amount has to be paid, the deposits can immediately be used while to get new loans takes time and effort and is also not sure to succeed.
Some analysts, however, also counter the statement that gross debt decreased, the chart on the blog quoted shows this.