His achievements are bad for Hungarian liberty—and an object lesson in what is possible for would-be autocrats elsewhere
BUDAPEST AND DEBRECEN, Aug 29th 2019. “Aking”, Bruce Springsteen has pointed out, “ain’t satisfied ‘til he rules everything.” It was to thwart this route to royal satisfaction that 18th-century thinkers such as Montesquieu and James Madison came to prize the separation of powers. If the setting of policy, the writing of laws and the administration of justice were the preserve of different people, absolute power could not end up in one set of hands. This was especially true if the different branches of government had some degree of power over one another. Now it is accepted that a certain amount of friction is the guardian of freedom in a democracy.
Viktor Orban, the prime minister of Hungary, has other ideas. In the place of such strife, he and his colleagues in Fidesz, the governing party, have over the past nine years sought to align the executive, legislative and judicial powers of the state. Those branches now buttress each other and Fidesz—sometimes unobtrusively, sometimes blatantly. Mr Orban refers to the result of these efforts as the “system of national co-operation”. He used to speak more openly of an “illiberal democracy”.
Through this systematic entanglement of powers Mr Orban and his associates have turned Hungary into something akin to a one-party state. They have done so with no violence at all and broad public support. The achievement is bad for Hungarian liberty and its long-term prospects—and an object lesson in what is possible for autocrats and would-be autocrats elsewhere.
The subtle workings of the “system of national co-operation” are testament to the legal expertise of those who fashioned it, including Mr Orban. In 1989, when Soviet power collapsed, he was a law student at Istvan Bibo College, an elite institution in Budapest. He was “domineering” but “sincere and likeable”, according to his roommate Gabor Fodor, later a political rival. His daring speeches at the anti-communist demonstrations sweeping Hungary quickly made him one of the leading lights of Fidesz, then a liberal student movement.
Mr Orban entered parliament in 1990, and in 1998 he became prime minister. His surprise defeat in the 2002 election accelerated Fidesz’s growing shift from liberalism towards nationalism. Over the course of the 2000s the party grew increasingly jingoistic, and by the time it won again in 2010 its appeal was largely grounded in Christian culture and ethnic identity. During the migrant crisis of 2015, Hungary became the first country in Europe to build a fence to keep out Middle Eastern refugees.
Fidesz’s image abroad is dominated by such demonstrations of nationalist ideology. But the legal and institutional creativity unleashed at home are a more important part of the story.
In 2010 a wave of anger at the previous Socialist-led government allowed Fidesz to win a two-thirds majority in parliament with just 53% of the vote. This was possible because of a peculiar electoral system set up after 1989 in which all citizens had two votes, one for a one-representative district and another for a multi-member district.
There were also 64 non-constituency seats which, as in Germany, are distributed so as to ensure the make-up of parliament was proportional to the national vote. In 2010 that topping-up proved unequal to the task. With the Socialists and several other parties dividing the rest of the vote, Fidesz won all but three of the 176 single-member districts and 84 of the 146 seats in the multi-member ones. Even with 61 of the 64 top-up seats allocated elsewhere, Fidesz ended up with 68% of the mps.
The party quickly set about using its two-thirds supermajority to change the constitution. It raised the number of justices on the constitutional court from 11 to 15, appointing four of its own to the new places. It then lowered the compulsory retirement age for judges and prosecutors, freeing up hundreds of posts for Fidesz loyalists. It set up a National Judiciary Office run by Tunde Hando, a college contemporary of Mr Orban’s. Her nine-year term, which is due to end next year and under current laws could not be renewed, makes her unsackable by parliament. Ms Hando can veto judicial promotions and influence which judges hear which cases. Fidesz now enjoys control of prosecutors’ offices, the constitutional court and the Curia (the highest court of appeals).
With the courts under its thumb, Fidesz pushed through a new constitution, drafted in part by Joszef Szajer, Ms Hando’s husband. In 2013 the constitutional court struck down some of Fidesz’s new laws, including one that threatened various churches with a loss of official recognition. Parliament responded by writing the laws into the constitution.
In 2018 a new code of procedure gave courts powers to reject civil filings more easily. Peter Szepeshazi, a former judge, says they can stumble over trivial errors such as a wrong phone number: “If it’s unfriendly to the political or economic elite, they have an excuse to send it back.” (The government calls this claim “unsubstantiated”.) A report in April by the European Association of Judges said Ms Hando was riding roughshod over judicial independence.
The government appears to want yet more say over the judiciary. Since 2016 it has been planning an entirely new system of administrative courts in which the Justice Ministry would have direct influence. These courts would handle, among other things, disputes over the media and elections—areas where the regular courts still, occasionally, rule against the government. The Venice Commission of the Council of Europe, a legal watchdog, has criticised the system, and in May the government put it on hold to keep its membership in the powerful epp group of the European Parliament, which had threatened to expel it.
It is not clear why Fidesz worries about the power to settle election disputes. Having gerrymandered the single-member districts after winning power in 2010, the party continues to win almost all elections. In 2011 Mr Orban granted voting rights to some 2m ethnic Hungarians who are citizens of neighbouring Romania, Slovakia, Serbia and Ukraine, and who overwhelmingly plump for Fidesz. They are allowed to vote by post. The roughly 350,000 Hungarian citizens living in the West are much less likely to support the party. They have to vote in person at embassies or consulates.
This all explains how, in the general election last year, Fidesz won 67% of the parliamentary seats—maintaining its supermajority—while taking just less than half of the popular vote. With the system so well re-designed, the party has no need to stoop to voter fraud, as cruder autocracies do. But the “system of national co-operation” is nothing if not thorough. In 2018 the National Election Office ruled thousands of postal votes invalid because the tamper-proof tape on the envelopes had been opened. In response, the government revoked the law requiring tamper-proof tape.
Legal fine-tuning has been used to suppress the opposition’s messages. In 2012, when esma, a Spanish-Hungarian company that held the concession for advertising on Budapest’s streetlamps was accepting advertisements from leftist parties, the city council banned all outdoor advertisements within five metres of roadways. The sidewalk kiosks owned by a government-friendly advertising group were exempted from the ban. In 2015 the almost bankrupt esma was bought by Istvan Garancsi, a businessman friendly with Mr Orban. The five-metre ban was promptly repealed.
This is just one of the ways Fidesz keeps the media on its side. The country’s biggest opposition newspaper, Nepszabadsag, was bought out and shuttered in 2016 by a company thought to be linked to Lorinc Meszaros, a boyhood friend of Mr Orban’s who is now the country’s second-wealthiest businessman. Lajos Simicska, a member of Mr Orban’s school and college cohort, built a large business and media empire that supported Fidesz in the 2010s. In 2015 he fell out with Mr Orban and lost most of his companies, but held on to Magyar Nemzet, another newspaper. After Fidesz’s overwhelming election victory in 2018, though, he closed it. Independent media are now confined largely to websites read by a few people in Budapest’s liberal bubble.
Deep Fake State
Content is controlled, too. After taking power in 2010, Mr Orban’s government began transforming mti, the country’s public news agency, into a propaganda organ. In 2011 parliament made mti’s wire-service free, driving competing news agencies out of business. Regional newspapers that lacked reporting staff became channels for mti’s pro-government messaging, and it is from those newspapers that Mr Orban’s rural base gets its news. The government uses its advertising budget, which has quadrupled in real terms to more than $300m per year, to bring any rogue newspapers in line.
The country’s domestically owned television and radio stations are nearly all pro-government. Last November the owners of 476 media outlets, including some of the biggest in the country, donated them free of charge to a new non-profit foundation known as kesma, whose goals include promoting “Christian and national values”. When opposition groups challenged kesma for violating the country’s media law, Mr Orban declared the foundation vital to the national interest, removing it from the media authority’s jurisdiction.
Turning media outlets into propaganda factories has not been good for their quality. In February the kesma foundation’s first chairman, a former Fidesz mp, carelessly joked in an interview that the pro-government media was so dull that even Fidesz members read the opposition press. (He was forced to resign within hours.) Despite being tedious, though, kesma and other pro-government media account for more than 80% of the news audience.
The production of news is managed, too. Parliamentary rules require that the government give notice of new bills and allow time for them to be debated, procedures which can lead to public criticism, even dissent. To avoid such problems, Fidesz often has minor mps table its bills, rather than doing so itself, which allows them to be rushed through in hours with the opposition nowhere to be seen.
To Viktor, the spoils
State-backed “public information” campaigns shape public opinion in ways beneficial to Fidesz. The National Communications Office, set up in 2014, co-ordinates both the government’s advertising spending—which is directed almost exclusively to friendly outlets, not critics—and its public-information efforts. This has been used, among other things, to build up antipathy towards George Soros, a Hungarian-American philanthropist. Although his foundation provided a scholarship which allowed Mr Orban to study in Oxford in the late 1980s, Mr Soros has become an appealing hate figure for Fidesz owing to his liberal politics and wealth. His Jewish background also plays a part. In 2017 the government spent €40m ($45m) on two nationwide surveys asking every citizen whether they favoured an alleged immigration plan supposedly hatched by Mr Soros—in effect, a government-funded propaganda effort. In the first three months of 2019 public-information spending reached €48m, much of it for a billboard campaign that accused Mr Soros of teaming up with Jean-Claude Juncker, president of the European Commission, to promote migration.
When control of parliament, the legal system and the media do not suffice, the government has other tools. Before the 2018 general election, the biggest threat to Fidesz came from Jobbik, originally a far-right party. It had moved towards the centre in a bid to go mainstream, and at times polled more than 25%. Enter the State Audit Office, headed by a former Fidesz mp who enjoys an election-proof 12-year mandate. In 2017 the audit office accused Jobbik of receiving illegal in-kind financing, and fined it 663m forints ($2m). In 2019, in the run-up to the European election, it tacked on another 272m forints, leaving the party close to insolvency. Two new liberal parties, Momentum and Dialogue for Hungary, as well as the Socialists, Democratic Coalition and the lmp (Green) party, were fined or investigated. Only Fidesz has been left untouched.
Some institutions have maintained their independence, but Mr Orban’s government seems intent on subverting them. Over the past two years it has harassed the Central European University (ceu), one of the most respected institutions in the region, into leaving Budapest for Vienna. The government insists that the clash stems from a technical dispute over the ceu’s awarding of American-recognised diplomas, and not from the fact that its scholars often criticise Fidesz, or that it was founded and endowed by Mr Soros.
Most recently, the government went after an organisation with a storied history: the Hungarian Academy of Sciences, launched in 1825 by Count Istvan Szechenyi. The academy helped standardise the Hungarian language, and played a key role in the nationalist awakening that led to the country’s emancipation from Habsburg rule. Last year the government announced that it wanted the academy’s 15 state-funded research institutes to be directly controlled by the ministry of technology and innovation. Negotiations went nowhere, says Zsolt Boda, head of the academy’s social-science institute. The government would show up with nothing on paper about its plans, sticking instead to deniable verbal statements. In July, parliament simply pushed the new structure through. The government says this brings things in line with the way they are done elsewhere, citing Germany’s Max Planck Institutes as an example. Officials at the Max Planck Institutes deny this, saying the Hungarian structure gives the state direct influence over scientists.
Despite its institutional advantages, Fidesz would not be able to stay in power if it were not so popular. It secures that support though its nationalist appeal and its passable economic record.
Like other eastern Europeans, most Hungarians saw the rejection of communism as a victory not so much of liberalism or capitalism as of national identity. And Hungary has a very strong sense of identity. The population of 10m is ethnically homogenous. Fewer citizens can read and write in a foreign language than in any other eu country, except Britain.
All of this made ethnic nationalism a sound strategy for Fidesz. It deployed an economic populism to match: an indigenous “Orbanomics” deemed superior to the supposed globalist neoliberal consensus. Mr Orban was elected shortly after the financial crisis, when Hungary was in a bad shape for which others were to blame. The crisis-induced fall of the forint meant that many Hungarians who had taken out low-interest mortgages in Swiss francs could not repay their debts. Mr Orban forced the banks to redenominate the mortgages in forints at favourable rates.
In 2011 Mr Orban pulled Hungary out of talks on an imf rescue package initiated by the previous government. After initially slashing a public-works programme launched by the Socialists, the government doubled its budget starting in 2012, creating hundreds of thousands of jobs. At the same time, it has introduced some relatively radical policies, such as a flat income tax of 15%. Growth and sober budgets have cut the national debt from 80% of gdp in 2010 to 71% last year.
Orbanomics also fits neatly into the authoritarian toolkit. Research by Gyorgy Molnar of the Hungarian Science Academy shows that in many villages with large numbers of public-works jobs nearly all of the votes go to Fidesz. In many cases, local mayors use public-works employees (who make less than the minimum wage) in their own businesses.
A new kind of feudalism
How well Orbanomics works as an economic policy, as opposed to a means of control, is open to question. Over the past six years growth has averaged 3.5%, and unemployment has fallen to 3.4%, which sounds good. But every country in central and eastern Europe has grown fast over the past five years, and Romania, Slovakia, Poland and the Czech Republic have all outpaced Hungary (see chart). Unemployment is below 4% in most of the region. Hungary is less productive than it could be, says Andras Vertes of gki, a consultancy in Budapest, and growth is dependent on aid from the eu, which amounts to some 2.5% of gdp, among the highest in the club.
Much of the rest is down to German carmakers, whose plants in Hungary account for up to 35% of industrial exports. The government is very eager to keep them happy. Last year, in one of Fidesz’s occasional political mistakes, the government passed laws allowing companies to demand that employees work longer overtime to be paid for at a later date. Analysts say the so-called slave law was a government effort to placate car companies worried about labour shortages.
As the “slave law” shows, the government pays less attention to the economic interests of ordinary people than to those of the elite. “The corruption is terrible,” says Mr Vertes. It was bad under the Socialists, he adds, but has got worse. In many industries, “the government decides who wins or loses.” Since the downfall of Mr Simicska, the first and most powerful Fidesz oligarch, Mr Meszaros, Mr Orban’s old village chum, has risen to comparable prominence. In 2010 Mr Meszaros owned three companies with a total equity of €2m; by 2016 he owned 125 firms worth €270m. He is now the second-wealthiest man in the country, according to an annual ranking published by the website Napi.hu. In an interview in 2014 Mr Meszaros said he had never embezzled and had acquired his wealth through hard work—though he also thanked “God, luck and Viktor Orban”.
Transparency watchdogs monitor the rise and fall of Mr Orban’s coterie by charting who gets the most public contracts. A new entrant on this year’s list of Hungary’s wealthiest 100 is Istvan Tiborcz, Mr Orban’s 33-year-old son-in-law. In 2017 an investigation by olaf, the eu’s corruption watchdog, recommended that Mr Tiborcz be prosecuted on the basis that his companies had rigged bids for tens of millions of euros in eu-funded municipal-lighting contracts. But olaf has no enforcement powers, and Hungarian police found no wrongdoing. Top officials tend to declare modest assets but lead luxurious lives.
Balint Magyar, a sociologist and former education minister who is now at the ceu, argues that the state under Fidesz is essentially a vehicle for capturing the economy and distributing its revenue streams to allies. Unlike communist parties, which had real titles of office and rule-governed internal hierarchies, Fidesz is an ideologically flexible vehicle that can be reorganised as the inner circle wants. Mr Magyar calls Hungary a “mafia state”, run by a clique whose main creed is loyalty. Kim Scheppele, a political scientist at Princeton University, notes the cunning deniability of the “system of national co-operation”. No country’s separation of powers is complete. Most of Fidesz’s arrangements can be found in one country or another. It is the cumulative effect all in one place that makes Hungary special.
Mr Orban’s system is the object of study beyond the academy. When Poland’s Law and Justice party took power in 2015, it mimicked Fidesz’s first moves, packing the country’s constitutional court and lowering the retirement age for judges. In 2017 Moldova’s oligarch-run government switched the country to a Hungarian-style mix of single-party districts and proportional representation. Binyamin Netanyahu, who has excellent relations with Mr Orban, has rewritten Israel’s constitution to pack more ministers into his cabinet for political convenience.
What could go wrong for Mr Orban? Other parties, which have tended to fritter away their support on squabbles, might team up against him. For the country’s mayoral elections this autumn they have struck a pact to stand aside in favour of the opposition candidate with the best chance in each constituency. But the parties’ ideological differences make this hard, says Bernadett Szel, the lmp party’s prime ministerial candidate in 2018. Liberal voters have qualms about tactically backing socialists, let alone the nationalists of Jobbik.
A serious recession or slowdown could also threaten Fidesz. The economy is excessively reliant on Germany, especially its car industry; near-term risks of German recession, and longer-term worries about the survival of the internal-combustion engine, make that reliance worrying. Hungary needs to shift from serving as a low-wage outsourcer to building its own high-value-added companies. But it ranks lower on competitiveness indices than other central European countries that are trying to do the same, says Mr Vertes of gki.
Other risks come from the eu. It expects to rejig its multi-year budget to send less aid to central and eastern Europe, which are doing well, and more to southern Europe, which is not. Rule-of-law advocates in Brussels would also like to build in conditionality, so that if countries move towards autocracy, their funding could be cut. But since Hungary would get a veto on this, it is unlikely to become law. Hungary has also opted out of the new European Public Prosecutor’s office, which will prosecute corruption on eu-funded projects.
“There are no normal democratic tools in place anymore,” says Judith Sargentini, a former Dutch Green mep. In 2018 she wrote a report on the threat to rule of law in Hungary that led the European Parliament to launch Article Seven procedures against the country; in theory these could lead to the loss of some eu privileges, though plenty of obstacles could get in the way
And if the eu is a potential problem for Mr Orban, it is a much greater advantage. European officials find it embarrassing to face up to the existence of a quasi-autocracy within the club, and thus have been slow to punish Hungary for its transgressions. More practically, the eu’s guarantee of freedom of movement makes Hungary easy to leave. And this is what many of those dissatisfied with his rule are doing.
Lights out tonight
Debrecen, Hungary’s second-largest city, is a conservative town of faded beaux-arts grandeur close to the border with Romania. Lili (not her real name) wants to leave it as soon as she finishes university. To illustrate why, she refers to a scandal at the elite grammar school she attended. In 2018 the Ady Endre school’s popular head was replaced with a primary-school teacher whose chief qualification seemed to be that he was a member of Fidesz. Teachers, parents, students and alumni protested, to no avail. “We have no voice,” Lili says. She plans to move to a more liberal town in the country’s west.
Others hit the border and keep going. Zsike, a graphic designer from Debrecen, ended up in the Netherlands: “If you don’t have important friends or family [in Hungary], you can never get anywhere.” Maria and her husband went to Austria to keep their children out of Hungary’s increasingly rote-oriented schools. For Monika, an English teacher who also ended up in the Netherlands, the final straw was when the government went after civil-society organisations: “That’s like dystopian, I’m thinking like 1984.”
Other countries in central and eastern Europe have seen a larger share of their citizens move west since joining the eu. But an analysis by R. Daniel Kelemen, a political scientist at Rutgers University, shows that the number of Hungarians living elsewhere in the eu has gone up by 186% since 2010, the biggest percentage increase of any member state. Those who go tend to be well educated. When Mr Boda, of the Academy of Science, is asked how many of his students are thinking of leaving Hungary after graduation, he replies: “All of them.”
From the government’s perspective, this may be fine. The emigration of liberal-leaning graduates only cements Fidesz’s power. Hungary’s communists might have been relieved if a free-thinking law student named Viktor Orban had gone off to Oxford and stayed there, ideally on Mr Soros’s dime. Instead, he came home, helped unseat them and replaced them with his own quasi-autocratic rule. “We thought we had come out of socialism and now we were going to be normal,” says Maria. “Instead it’s still the same old shit.” ?
This article appeared in the Briefing section of the print edition under the headline “The entanglement of powers”. Aug 29th 2019