In the course of his long political career, Hungary’s Prime Minister Viktor Orbán has on many occasions divided public opinion by making controversial speeches. The most recent one was made just a few days ago in the course of the Bálványos Free Summer University and Student Camp, an event organised by the Hungarian community in the Romanian village of Băile Tușnad situated in the heart of Transylvania. In this speech, made in the presence of thousands of people, the Hungarian premier indulged himself by addressing the subject of social order using astonishing words. “Migration has divided Europe, or rather the West, into two parts,” Orbán said in an anti-immigration passage, “one half of the continent is where Europeans and non-Europeans live together. These countries can no longer be called nations: they are nothing more than an agglomeration of people.”
In the past Orbán had already attacked the liberal model of open societies, in his opinion a threat to European integrity, but had never done so in such a direct manner explicitly addressing the issue of race. “In the Carpathian Basin we are not a mixed race: we are simply a mix of people living in our own European homeland… This is what we have always fought for: we are willing to mix with one another, but we do not want to become mixed-race people.”
These statements have shocked the Hungarian Jewish community, which immediately requested a meeting with Orbán, making no secret of their disquiet. On the other hand, former prime minister Ferenc Gyurcsány called Orbán “a tragedy for Hungary.”. The most resounding reaction, however, was that of sociologist Zsuzsa Hegedüs, his advisor for two decades, who announced her intention to resign from her position with a letter in the first person addressed to Orbán and published by the online newspaper Hvg.hu . In one of the harshest passages, the sociologist asked the Hungarian prime minister how he had managed to not realise he was delivering a totally Nazi speech, worthy of Goebbels. Ms. Hegedüs later backtracked, acknowledging that Orbán later clarified being against immigration on cultural, rather than biological grounds, and thus withdrawing with a new letter her resignation.
But what are the reasons that led Orbán to make a speech of this kind? One explanation, according to Nicholas Watson of Balkan Insight, is that may have been a gesture aimed at the American Right, which will meet in August in Dallas at the Conservative Political Action Conference (CPAC) and with which the Hungarian Right has been flirting for some time.
Another interpretation could however be linked to domestic policy. The excitement of the overwhelming win in the elections held early in April has now passed, the Hungarian government finds itself addressing a series of problems, so the “racial” speech may have been an excellent “weapon of mass distraction.”
In recent weeks thousands of people have taken to the streets of Budapest to protest against fiscal reform applied to VAT registration, the so-called Kata Law, which has affected about one and a half million people now forced to switch to a more burdensome system. This was a vibrant and constant protest that lasted for many days, the sign of a certain malaise that is starting to spread though society. These are not easy times for the Hungarian economy and the decision to approve such an unpopular law certainly had its roots in the need for money. In June the exchange rate between the forint and the euro rose above the psychological limit of 400 to one. The devaluation of the Hungarian currency surged in the aftermath of the beginning of Russia’s invasion of Ukraine, but follows a now decade-long trend.
In addition to the weakening of the forint, Orbán must also deal with runaway inflation, which has reached 11.7% year-on-year and is eroding purchasing power. Hence the decision to lower the prices of some essential goods, including seven basic foodstuffs, and cap the price of fuel. This last decision has had numerous consequences. While over the short-term it has certainly helped Hungarian families, it has on the other resulted in disapproval within the European Union since this capped price is reserved exclusively to cars having Hungarian number plates, while those registered abroad pay the market price. This is discrimination according to the EU, while it is considered a way of avoiding petrol shortages according to authorities in Budapest. The risk however remains. MOL, the country’s main oil company, has had to reduce its daily supply limit from 100 to 50 litres and the company’s CEO, Zsolt Hernádi, has spoken of a ‘very dangerous’ situation” that will sooner or later result in running out of fuel if prices remain capped. According to current regulations prices will remain capped until October.
The energy crisis
The fuel problem is part of the spectrum of energy issues currently high on the agenda of all European chancelleries. A couple of weeks ago, the Hungarian prime minister urgently convened a crisis unit to discuss action to be taken to avert the risk of not being prepared for the winter season should Russia decide to cut off gas supplies. The result was a seven point measure , including a number of particularly drastic decisions. These rules include a ban on the export of all kinds of fuel – opposed by the European Union -, the resetting of bills according to the principle that those who consume more than average must pay much more than those who consume less, and authorising Foreign Minister Péter Szijjártó to purchase additional gas reserves.
This point assumes particular importance in view of the fact that only a few days after these measures became effective Szijjártó travelled to Moscow to meet Russia’s deputy Prime Minister Alexander Novak, and Trade Minister Denis Manturov. Discussions concerned the purchase of 700 million cubic metres of gas. This was a visit that appeared to be a slap across the face aimed at recent European policy, the objective of which involves breaking free from Russian energy dependency. In fact, the Hungarian minister was the first high-level European diplomat to visit Russia since the beginning of the war. The only exception so far had been Austrian Chancellor Karl Nehammer in April, but that was a different kind of mission.
Confirming its role as a thorn in the EU’s side, Hungary was very recently the only country to oppose the 15% gas reduction plan presented by the European Commission. Orbán explicitly explained his position saying, “I cannot see how it will be possible to apply this strategy. Furthermore, if it does not have the desired effect and someone remains short of gas, it will be taken from those who have it.” As often happens, the target of his attack was Germany. “The Commission is not asking Germany to close down its last two or three nuclear power plants that allow the production of low-cost energy. If they run out of energy they will take gas away from us.”
The Hungarian niet is only the last of a series of vetoes issued over recent months and that have caused serious problems as far European policy regarding Russia is concerned. Among other things, Budapest had been the main obstacle to signing the sixth sanctions package, which envisaged an embargo on Russian oil on which Hungary is heavily dependent. After long and gruelling negotiations, Hungary obtained that the ban would only concern oil imported by sea, thus excluding oil coming by land via the Druzhba pipeline.
Hungary’s official position has always been that of supporting the Ukrainian people, but in reality its actions have often annoyed Kiev and its Western allies. “Our priority is to defend Hungary”, has been the mantra often repeated by Orbán in recent months, a statement that has allowed him to justify unpopular decisions, such as banning the transit of weapons to Ukraine and cashing in on electoral consensus. Orbán has always made it known that he is against sanctions, which, in his opinion, have so far caused more damage to Europe than Russia. “Europe has shot itself in the foot and is now finding it hard to walk,” he said recently.
Friction with Brussels
There are certainly many reasons for friction with Brussels, not least the continued blocking of the 15-billion-euro Recovery Fund due to lack of respect for the rule of law. The Commission believes that corruption problems have not yet been resolved and has expressed its concern in a detailed report presented last month. However, something seems to have changed in recent weeks. Budapest has presented a proposal envisaging the reduction of state calls for tender in which only one tenderer participates at 15% of the total. Hungary has also proposed changes to be made to its judicial system and promised to make its legislative process more transparent and inclusive. There is still a significant distance between the parties, but the Commission has decided to give Hungary one more month to answer the observations made and present any eventual corrective measures it intends to implement.
In addition to issues linked to the Recovery Fund, but no less important, there are those linked to the so-called Child Protection Law approved a year ago, which forbids minors under the age of 18 to access content addressing subjects such as homosexuality or gender identity. It is a law that the European Commission considers liberticidal and detrimental to the rule of law, and for which Budapest had already been subject to infringement proceedings. The Commission has now decided to refer Hungary to the European Court of Justice. Budapest will also have to answer for the closure of Klubrádió, one of the last independent radio stations in the country, which was obliged to stop broadcasting last year.
One last chapter yet to be resolved is that of the Global Minimum Tax applied to multinational companies. In this case, too Hungary is the only country to have expressed its opposition after initially approving it. Officially the government’s position is that increasing tax to be paid by European manufacturers would be risky during an economic crisis, but there is, however, a well-based sense that for Budapest this is simply a lever to be used so as to resolve the Recovery Fund issue. But Băile Tușnad’s speech yet again reminds the EU of the true nature of the leader with whom it finds itself obliged to negotiate.
Cover Photo: Hungarian Prime Minister Viktor Orban holds a joint press conference with Austrian Chancellor Karl Nehammer (not seen) – Vienna, July 28, 2022 (Askin Kiyagan / Anadolu Agency/AFP).
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