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Fidesz Wants to Jail Former Socialist Prime Ministers

Once again, Fidesz intends to divert public attention from its own economic policy mistakes as well as austerity measures and the curtailment of workers’ rights by the criminalization of its domestic political opponents.
The parliamentary subcommittee responsible for the investigation of public debt increases issued a report last week proposing a probe into the legal liability of previous government members in order to determine whether legal proceedings could be launched against them. According to the motion, the subcommittee will turn to the Parliament’s Financial and Budgetary Control Committee and to the Committee for Constitutional Affairs in order to take a stand on the possibility of initiating criminal proceedings in connection with the substantial increases in Hungarian state debt between the years of 2002 and 2010. The report was voted unanimously (7 – 0) by committee members representing only governmental Fidesz and KDNP [Christian Democratic People’s Party] parties, plus by an independent member. Another member of the committee – associated with Jobbik party – did not vote due to leave abroad. MPs belonging to the Socialist Party and to LMP (Politics Can Be Different party) refused to take part in the work of the subcommittee.
Péter Szijjártó (Fidesz), who acts as vice-chairman of the parliamentary body, said at a meeting that the report of the subcommittee showed that former Socialist and liberal governments, which had been in power for 8 years in Hungary, committed ‘political sin’ against the country. According to Szijjártó, it was established that these governments tumbled Hungary into debt through their wrong and misguided economic policy decisions, and that is why the public debt to GDP ratio increased from 53 percent to 80 percent by 2010. The figures mentioned by Szijjártó distort reality given that the first government of Orbán did not account for several off-balance-sheet obligations, so the public debt to GDP ratio was actually more than 53 percent already in 2002, while the second Orbán cabinet took over less than 80 percent in public debt in early 2010. The 53 percent claimed by Mr. Szijjártó did not include hidden obligations of the Hungarian Development Bank (Magyar Fejlesztési Bank; MFB), which had to be added later to the official 2002 budget deficit number in line with European Union accounting rules (according to the National Bank of Hungary [MNB], this move alone increased the actual public debt to GDP ratio to 55.6 percent by the end of 2002), while Hungarian state debt reached 80.2 percent of GDP by the end of the year in 2010 – so it already contained obligations assumed by the new government that has been in power since May. Neither should it be forgotten that, in the period between 2002 and 2010, Hungarian governments also faced exceptionally harsh conditions due to the worldwide financial and economic crisis; however, the dynamics of the increases in the budget deficit and state debt were actually below that of the EU average, and still, they are not excessive.
A major part of the increase in Hungary’s public debt can be attributed to long-term decisions made by the first Orbán government (amongst others, to the unsustainable home-buyers’ tax credit system), and to the 100-day program of the Medgyessy government, which was, however, also supported by Fidesz MPs back then.
Tamás Katona, former under-secretary at the Ministry of Finance believes that Fidesz has two objectives with its intention to start criminal proceedings against former government members. On the one hand they desperately try to divert the public’s attention from their own amateurish economic policy decisions, and they also try to explain their own failure by the wrongdoings of previous governments. By now, maybe even they themselves give credence to the notion that the Socialists brought the country to ruin – said Mr. Katona in an interview with Népszava. On the other hand, the policy of reckoning [of former government officials] pursued by Fidesz obviously and completely failed – they did not find anything to show their core voters. That is why they are now trying to convert political liability for the increase in Hungary’s public debt to legal liability, which is absolute non-sense; something like this can never happen in a state under the rule of law, however, such concerns have not yet bothered the ruling government very much – Mr. Katona added.
Socialist politician László Kovács responded that he knows of no country where the budget deficit and national debt are a matter of criminal law. “One does not usually turn to the courts because an economic policy is later judged to have been the wrong one... The voters issue the verdict in matters of politics,” Kovács was quoted as saying by state news agency MTI. The Hungarian Socialist Party (MSZP) would participate in any bona fide examination but not in “show trials”, he said.
Both the MSZP and the green-liberal LMP had refused to take part in the committee meeting. In a statement, the head of the MSZP’s economic policy unit, Imre Szekeres, accused Fidesz and the far-right party Jobbik of “misleading” the public. Szekeres agreed it was important to review and learn from national debt processes over the past 20 (not eight) years, however. Szekeres recalled that the Socialist-led government of 1994 to 1998 under prime minister Gyula Horn reduced a 90 per cent central government debt inherited from the right-wing (but not Fidesz) first democratically elected government to 62 per cent in three years (this was a deeply unpopular austerity package of finance minister Lajos Bokros). Szekeres argued that the fall to 52 per cent under the first Fidesz government from 1998 to 2002 was due to a continuation of reforms implemented by Bokros. Furthermore, he blamed Fidesz for raising the debt from 77 to over 80 per cent in the second half of 2010.
Fidesz responded with its own statement: as the MSZP and LMP excluded themselves from the work of the committee, they have “no right to judge” its findings. The one-year MSZP caretaker government of Gordon Bajnai in 2009-2010 – whose work was closely monitored by the IMF and the EU – handed Fidesz “false data”, the governing right-wing populist party claimed. Horn’s debt reductions were largely due to privatisations, the party’s parliamentary group argued. During its first go at government from 1998 to 2002, Fidesz introduced a mortgage interest subsidy scheme aimed at young families and encouraging young couples to have children, with cash bonuses toward housing. Kovács claimed that this costed the treasury as much as Medgyessy's two “100-day plans” combined. The total annual cost of housing subsidies rose from roughly HUF 50 billion (EUR 184.14 million) a year in 2000 to HUF 255 billion (EUR 939.14 million) in 2005, according to a 2009 report from the State Audit Office.
LMP also declared earlier that it was a political and legal nonsense that former premiers and finance ministers were threatened with jail.

Last Updated on Friday, 30 August 2013 09:11



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