by William Nattrass
Tuesday, 13
December 2022
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15:15

Viktor Orbán names his price

The Hungarian PM has fallen into line with EU leaders after a €5.8 billion deal
by William Nattrass
“Difficult, me?” Credit: Getty

Late on Monday night, an agreement was reached in the EU’s long-running “rule of law” tussle with Hungary. Brussels’s plan to financially punish the miscreant member state will become reality but, in classic EU style, a compromise allows both sides to claim victory. Viktor Orbán has allowed himself to be bought off, having created significant political problems for the Union in recent weeks.  

The EU will approve Hungary’s pandemic recovery fund worth €5.8 billion and reduce the proportion of regular funding programmes to be withheld from Budapest, from 65% to 55%. In return, Hungary has relented in its controversial opposition to EU implementation of a global minimum corporation tax and loans for Ukraine. 


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The squeaky wheel gets the grease, and it was always likely that this saga of mutual blackmail would end in a compromise. Total victory for either side would have been disastrous: a more complete funding block would have alienated Hungary and paralysed the EU for good, while failure to punish Orbán would have left the European Commission’s reputation in tatters. 

Orbán’s hawkish opponents think Hungary shouldn’t get any EU funding at all, but Budapest turned the dispute on its head by displaying a willingness to torpedo the EU’s political agenda. Orbán can now portray the reduced funding cuts as a hard-won victory; Hungarian sources claim he has also secured a form of participation in the new global minimum corporation tax which won’t entail raising low domestic tax rates.  

The strongman sorely needed a victory with the Hungarian economy teetering close to calamity. Inflation is at 22.5% and the governor of the national bank last week fired a remarkable broadside at the government’s economic policy.   

The government portrays EU sanctions on Russia as solely responsible for the current difficulties, but uncertainty over EU funding has been another major negative factor. The Hungarian Forint exchange strengthened significantly on Tuesday morning – and in typical Orbán style, a 15% increase in pensions was announced hot on the heels of the agreement in Brussels. 

Yet while the agreement was in everyone’s interests, it would be a mistake to think it means the end of the rule of law saga. Pandemic recovery funds for Hungary will only be released if Budapest meets a set of milestones set by Brussels, and one need only look at the bloc’s treatment of fellow rebel state Poland to see how this is likely to pan out. The EU still hasn’t released money from Poland’s approved fund, and many assume Warsaw won’t see a cent until general elections next autumn, when Poland’s current nationalist government will be challenged by arch-Europhile Donald Tusk.  

And although the EU claims its rule of law measures are motivated solely by a wish to safeguard democracy, there’s a clear political motivation to the proceedings. Ideological hostility to Hungary stems from Orbán’s anti-LGBT measures and his ambivalence on Ukraine, and these issues aren’t going away any time soon. Monday’s agreement will bring about a détente in EU relations, but more trouble may be expected down the line, with Orbán having already shown his willingness to bring the bloc to a shuddering halt.

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Andrew Wise
Andrew Wise
1 month ago

And although the EU claims its rule of law measures are motivated solely by a wish to safeguard democracy, 

Which democracy? When I last looked Hungary democratically elected Orban but the rest of the EU shower are all appointees
Nothing democratic about the EU except the fig leaf of a parliament with no power and bunch of ***s with their snouts so far in the trough they can’t see daylight.

Jim Veenbaas
Jim Veenbaas
1 month ago
Reply to  Andrew Wise

That’s the kicker. The EU is run by a bunch of unelected grifters who are accountable to no one. Yet they set the standards in countries with free and fair elections.

Oliver Elkington
Oliver Elkington
1 month ago
Reply to  Jim Veenbaas

I think the EU is democratic, the issue i have is that they made the UK take in any migrant from most of Europe who wanted to come here, Albania is also a candidate to join the EU as well….

Jim Veenbaas
Jim Veenbaas
1 month ago

The EU is truly truly awful. Germany will buy natural gas from any authoritarian dictator willing to sell it – govts with truly horrific human rights records – but heaven forbid Hungary and Poland step out of line.

Brian Villanueva
Brian Villanueva
1 month ago

I keep saying it: liberal democracy is an oxymoron. These two ideas are in conflict and one will always win out over the other. Our professional managerial class across the Western world has demonstrated they are willing to jettison democracy and pursue secular liberalism by authoritarian means.
Hungary is unquestionably democratic. And when the people of Hungary choose to do something not in accordance with secular liberalism, the EU shows its authoritarian colors.
The doctrine of “maximal individual autonomy” at the heart of liberalism is going to implode. Like “liberal democracy”, it’s a built in contradiction and is constructed on a philosophically false view of man.

Snapper AG
Snapper AG
1 month ago

Don’t call the technocratic elite liberal, they are far from it. Woke fascists is closer to the truth.

Jim Veenbaas
Jim Veenbaas
1 month ago

These technocrats and bureaucrats are not even close to liberal. They’ve twisted liberalism into a pretzel. They are authoritarian m, pure and simple.

Peter D
Peter D
1 month ago

How dare Hungary have its own opinion! The cheek. My LGB etc colleagues all have a love us or perish attitude. Differing opinions are not permitted. Democracy is a farce.
The extreme left controls the beaurocracy, our education system, and the mainstream media. As long as we continue to eat, drink, and stream, our heads are down and we are good little citizens.

Brian Villanueva
Brian Villanueva
1 month ago

I call them “liberals” for several reasons: 1) because it is the label their side has traditionally been known as; 2) it is a neutral descriptor which doesn’t make the uninformed tune out; 3) their philosophy is the logical endpoint of John Stuart Mill’s liberalism. It’s Mill who proposes a world of maximal individual autonomy — “my rights only stop at your nose”.
I understand the desire for new labels to make people sound as evil as they are. But it’s counterproductive.

R Wright
R Wright
1 month ago

Unelected bureaucrats take measures against democratically-elected politicians in the name of safeguarding democracy. Incredible.

Ian Barton
Ian Barton
1 month ago

Strange not to mention that the need to deflect attention away from last week’s EU corruption scandal probably forced the Commission to announce an agreement – before Orbán started ridiculing them again.

Last edited 1 month ago by Ian Barton
Justin S
Justin S
1 month ago

I recently visited Hungary and I felt the place was a pleasant, reasonable, civilised and calm, with a welcoming attitude to tourist cash and huge amount of civil spoken English. Try that out in Paris.
While we were there a large public protest was held, calmly and good naturedly by a broad swathe of people with minimal police presence. Not exactly a police state or a hostile to democracy oligarchy the way the EU would like to have us believe.
The article writer almost certainly has his own little personal axe to grind in his overt and clear anti Orban / Hungary position piece.
The EU hates Orban solely and only because of his anti – LGBT alphabet stance.

I would say that 90% of all of the angst and conflict with Hungary is centred on the gay power movement in the EU.

Andrew Buckley
Andrew Buckley
1 month ago

Solid support for democracy, well democracy we agree with anyway, from the EU.
(Oh, and I am not a fan of Orbin by the way)