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Balancing between east and west: Hungary is running out of solutions

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Balancing between east and west: Hungary is running out of solutions


As a member of NATO and the EU, Hungary has been walking a political tightrope during the Ukraine crisis as it tried to position itself on both sides of the East-West fence. The US government is convinced that Hungary has got prohibitively close to Vladimir Putin’s Russia. At the same time Hungarian domestic politics has caught the eye of the EU and United States.

After several mass demonstrations made the government shelve the so-called internet tax, on Sunday again 10,000 people took to the streets. They marched against the government after the United States accused the head of the country’s tax authority and several other officials of corruption and slapped a travel ban on them. Washington says it has evidence of wrongdoing while the Hungarian government denied any knowledge of such a list. IIdiko Vida, the country’s tax chief, admitted to being one of those on the list. She added that she had nothing to hide, denied any wrongdoing and had no intention of resigning.

The US says the corruption is a symptom of the weakening of the country’s democratic institutions. US Chargé d’Affaires André Goodfriend said: “At a certain point the situation, if it continues this way, will deteriorate to the extent where it is impossible to work together as an ally.”

The travel ban comes amid a wider souring of the relations between Hungary and both the United States and the European Union over what is perceived the increasingly authoritarian rule of PM Viktor Orban.

From the American point of view, Hungary is supposed to be an ally as a NATO member but the country seems to support Russian interests. Budapest depends on the EU and Russia at the same time – while the Kremlin is crucial for energy, Hungary also receives a lot of funding from Brussels.

Former US Secretary of State Hillary Clinton and President Barack Obama criticised some steps made by the Hungarian government before, saying those can hurt democratic values. The US frowned at the deal Hungary made with Russia about expanding the Paks nuclear plant and the fact that Hungary supports South Stream, the new Russian gas pipeline. At the same time Hungary criticised EU sanctions against Russia and once suspended the gas transfers to Ukraine, weakening the EU’s negotiating positions.

Moreover, Orban in a public declaration in July, stated he wanted to build an “illiberal state based on national foundations”, citing Turkey and Russia as examples. “The new state we are building in Hungary today,” Orban said, “is not a liberal state. It does not deny liberalism’s basic values such as freedom but doesn’t make it its core element … I don’t think our European Union membership precludes us from building an illiberal new state based on national foundations,” the PM said in his speech.

Orban was elected in 2010 with a two-thirds majority. This gave him more power than any of his predecessors since the fall of the Iron Curtain in 1989. He has tightened his grip on the courts, the judiciary and media. In addition he has changed election rules to help him maintain a majority in parliament.

He also intervenes in the economy. The government made it harder for multinational companies and banks to make profit, then bought stakes in energy firms and banks. Hungary also took steps to tighten business relationships with Eastern countries, especially Russia – a policy of Eastern opening.

With the introduction of new taxes he has angered, not only multinational companies which suffered losses as a result, but also his allies, among them businessmen who have long supported him.

Hungary is in a delicate situation. But Hungarian politics do not seem to change.

Despite the internal and external problems Prime Minister Orban still follows his regular line, reacting in Munich last Thursday to the latest accusations from Washington saying, “ the US puts pressure on Hungary because of South Stream and the new deal about the Hungarian nuclear power plant, which will be extended and developed by Russia”.

Orban was at pains to point out: “Hungarian politics is not pro-Russian, but pro-Hungarian.”

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