Letter to the editor - Budapest Times
Your publication of the article (“All for one or one for all?”, political analysis, 23 May) by Júlia Lakatos from the “Centre for Fair Political Analysis” makes me wonder if you have been receiving threats from the Media Council. I have no idea who the Centre for Fair Political Analysis are, but can only imagine that they must be some part of the Fidesz propaganda machine.
Lakatos argues that the actions of the Orbán government have now been vindicated by the elections in Greece and France – those countries are now turning against austerity, just as Orbán did in 2010. The Greeks have chosen to leave the euro instead of staying in it, Europe is in a mess and we have returned to a situation of each country to their own.
Under such a situation (she argues) the Orbán government has been right to pursue a tax on banks, which other countries have followed (according to Lakatos) and nationalisation of the private pensions, which is not unprecedented. While the EU has been upset by these decisions, the government’s policy of “going it alone” will prove to be correct, she argues.
Please let me offer a more accurate assessment of Orbán’s “alternative policies”.
While in opposition, Mr Orbán promised a flat rate tax, so when he came to power he had to deliver. He soon discovered that such a low tax was unsustainable, given the state of the public finances. Rather than admit this, and risk losing his popularity, he found other ways to raise money.
First the multinationals. Most Fidesz supporters fear foreigners, so what better way to please them than to tax the bastards. Bound to be popular, and raise some money. The problem is these nasty foreigners provide a lot of much-needed capital, and many jobs, and if you tax them too much they will simply go elsewhere.
The “nationalisation” of private pensions (although a more accurate word would be theft) simply means that the government is saving a huge pension liability for another generation to pay.
“It appears that however rocky the road has been, in the long term the government’s strategy of ‘going it alone’ is paying off,” argues Lakatos. Really? While foreign investment to the rest of Central Europe is increasing, foreign capital flows into Hungary are now below their 1997 level. In the rest of Central Europe, bank lending is back to what it was before the crisis while in Hungary it is at 83 per cent of the pre-crisis levels and falling.
I am sure that Hungarians of my generation will not thank Mr Orbán when they retire without a pension. And I am sure that Hungarians of my children’s generation will not thank Mr Orbán when they have to go abroad to find work. Still, at least there won’t be any nasty multinationals in the country.
Mr Orbán’s “alternative policies” do not represent an intelligent, well-thought-out challenge to orthodox economic thinking. They represent the actions of a nationalist government that has lost control of the economy.
While a small minority of the Hungarian electorate may “buy” these Alice in Wonderland theories about the great Orbán government, I believe that most of the readers of The Budapest Times are probably more intelligent than to swallow such nonsense, and I sincerely hope that we will not have to read more such rubbish in The Budapest Times.