Viktor Orbán rides out a scandal

Welcome back. Viktor Orbán, Hungary’s strongman prime minister, got straight to the point last Saturday when he gave his annual State of the Nation speech in Budapest. His opening words were: “The year 2024 could not have started in a worse way.”

Orbán was referring to a political scandal that some of his domestic critics said might threaten his hold on power. But is Orbán really in trouble? Are his prickly relationships with the EU, the US and Nato, or his warm ties with Russia and China, likely to change? I’m at tony.barber@ft.com.

I’ll look at recent developments from five angles: the scandal that forced the resignation of Hungary’s head of state; the means by which Orbán controls the country; Hungary’s relations with the EU; its wider foreign policy; and the economy.

A scandal topples three loyalists

Katalin Novák, an Orbán loyalist who in March 2022 became the first woman and youngest person to be selected as Hungary’s president, isn’t the only one to lose her job because of the scandal.

It also claimed the scalp of Judit Varga, Hungary’s former justice minister. She had been set to spearhead the campaign of Fidesz, Orbán’s ruling party, for the June elections to the European parliament.

Another head to roll was that of Bishop Zoltán Balog, president of Hungary’s Reformed Church. Earlier in his career, he switched from pastoral duties to a six-year spell as Orbán’s minister for human resources.

All three fell from grace after it emerged that Novák had pardoned a man once convicted as an accomplice in the cover-up of a sex abuse case in a children’s home. In his speech, Orbán described the affair as “a nightmare, and it is taking a toll on us all”.

Family values

The presidency has few meaningful powers in Hungary. In the Orbán era, its occupant is entirely dispensable — as we saw in 2012, when Pál Schmitt, another Fidesz loyalist, resigned in a plagiarism scandal.

However, as Orbán acknowledged, the child sex abuse affair was a tremendous embarrassment. It struck at the heart of his government’s claim to be a stout defender of Christian family values, in contrast to what Orbán portrays as the moral degeneracy of western European liberalism.

Novák and Varga were the public faces of this aspect of the Orbán regime’s ideology. Iván László Nagy, writing for Visegrad Insight (an excellent resource on central European politics), says:

As Orbán’s international relations grew increasingly adversarial, Novák played the good cop, a younger woman representing the government’s core issues less violently and making grand gestures, such as visiting Kyiv and giving an interview to an independent news outlet …

Viktor Orbán has let go of the most powerful women in Fidesz over the past 10 years to preserve his legacy . . . [The scandal] draws a gruesome picture of a Janus-faced regime that pardoned a paedophile accomplice amidst its vehement child protection campaign.

An insider breaks ranks

The fact is, however, that Orbán has acted forcefully to contain the damage. In my view, his grip on the levers of power — from parliament and the judiciary to the media — is so firm that he is in no real danger.

True, there have been some large street demonstrations in Budapest, but that is nothing new in the Orbán era. So far, they have not led to much.

Still, the scandal hasn’t completely died down. Indeed, there are some signs of discomfort in Fidesz.

Péter Magyar, a former regime insider (he held management roles in state-owned companies and is Varga’s former husband), has broken ranks. He not only accused the government of “hiding behind women’s skirts” — that is, avoiding responsibility for its own errors.

Broadening his attack into a condemnation of the political and business structures that keep Orbán in power, Magyar also described Hungary as “a holding company in the hands of a few families”.

Patronage, state capture and identity politics

Among various studies that assess Orbán’s rule, one of the most insightful appeared in 2019 in the journal East European Politics. Entitled “Caesarean politics in Hungary and Poland” and written by Robert Sata and Ireneusz Paweł Karolewski, the article identifies the three distinguishing features of Orbán’s regime (and that of Jarosław Kaczyński, now out of power, in Poland) as patronage, the capture of state institutions and identity politics.

Patronage involves “a single patron controlling an elaborate system of rewards and punishments . . . personal access to the patron is essential for political survival and enrichment”. This is exactly the point Magyar has been making.

State capture involves the ruling party taking control of core institutions such as the courts and business enterprises, and setting up “networks of corrupt actors that act collectively to pursue private interest at the expense of the public good”.

Identity politics involves “discourses that tap into public xenophobia”. The regime targets “enemies” such as migrants, minorities, liberals in opposition parties, non-governmental international organisations and Brussels bureaucrats.

For similar reasons, Armin Schäfer and Michael Zürn write in their book The Democratic Regression (newly translated into English from a 2021 German edition): “In no country in the world has democracy suffered a decline as steep as the one in Hungary.”

‘Our natural environment’

Although Orbán is at odds with the EU establishment over everything from the rule of law to support for Ukraine, he sees Hungary’s place as firmly in the 27-nation bloc. “The European Union is our natural environment,” he said last Saturday.

As we see in the European Commission’s latest Eurobarometer poll, Hungarians are broadly happy with that. Some 41 per cent of them have a positive image of the EU, 47 per cent are neutral and 12 per cent have a negative view — more or less in line with the EU average.

Orbán’s aim is to ride a wave of support for hard-right, conservative nationalist parties across Europe, including in the forthcoming European parliament elections, to transform the EU from within. “Our plan is not to leave the EU,” he said last year. “Our plan is to conquer it.”

In this respect, it’s useful to Orbán that Hungary’s turn at holding the EU’s six-month rotating presidency will start on July 1. For the EU’s Brussels-based institutions and the many governments fed up with him, it’s fortunate that the rotating presidency no longer commands the bloc’s agenda in the way it once did.

Orbán’s Christmas presents

One source of tension between Hungary and its western allies should be removed as early as Monday when the parliament in Budapest is expected to approve Sweden’s Nato membership.

Yet if we turn again to Orbán’s State of the Nation speech, we see that he is still an outlier in the camp of western democracies. He stated in no uncertain terms that he wanted Donald Trump to win November’s US presidential election and end the war in Ukraine — something that, if done swiftly, would presumably leave Russian territorial gains in place.

Moreover, Orbán said he hoped his gifts “under the Christmas tree at the end of the year” would include “stronger regional co-operation among Slovaks, Austrians, Serbs and Hungarians”. Here he had in mind a possible victory for the far right in Austria’s forthcoming elections, bringing to power a government with an outlook similar to those of Hungary, Slovakia and Serbia.

Significantly, Orbán made no mention of the Visegrad Four group — the Czech Republic, Hungary, Poland and Slovakia — which was once a cornerstone of pro-EU central European diplomacy.

The economy: ties with China flourish

Finally, a brief look at Hungary’s economic performance. Measured in terms of gross domestic product growth, it has been rather modest over the past three years, as the chart below shows.

However, this doesn’t tell the whole story. Orbán’s ambition is to turn his country into an indispensable European hub of the world’s electric vehicle industry. He is making solid progress on this front as Chinese EV and battery companies pour investment into Hungary.

It should be noted, however, that Hungary’s ties with China are developing in areas beyond trade and investment. It emerged this week that Hungary plans to deepen co-operation with Beijing on security matters — though details remain sketchy.

These are the long-term trends that need watching. By contrast, the scandal that rocked his government this month, though damaging in the short run, seems unlikely to pose a serious threat to Orbán’s rule.

More on this topic 

Orbán aims for a more autocratic Europe — a commentary by Ulrich Speck for the Neue Zürcher Zeitung

Tony’s picks of the week

• The US is attracting a record amount of capital investment from German companies amid tougher conditions in their home market and in China, their largest trading partner, the FT’s Jamie Smyth in New York and Patricia Nilsson in Frankfurt report

• China is challenging democracies such as Australia, France, Japan and the US for strategic influence in the south Pacific, posing awkward choices for leaders of the area’s thinly populated island-states, Meg Keen and Alan Tidwell write for the Sydney-based Lowy Institute