Kocsis Éva: Prime Minister Viktor Orbán is with us in the studio. Good morning.
Let’s begin with the Olympics. Who made the final decision on Wednesday to withdraw the Olympic bid?
Well, on Wednesday several bodies held meetings, and I think we simply drew the conclusions from these meetings. The General Assembly of Budapest City Council held a meeting, there was also a Cabinet meeting, and in the end the President of the Olympic Committee, the Mayor of Budapest and I pooled our thoughts and came to the conclusion that in order to spare Hungary disgrace and major loss of face, the best decision would be to withdraw our bid.
What would this disgrace have been exactly? The referendum?
Oh no, not at all! The referendum is a Hungarian issue. But the Olympic bid cannot be won at home. It must be won in an international competition: in Switzerland, in Lausanne, before the International Olympic Committee. We could win the referendum at home – but even then it would only be a majority. But to win the Olympic bid at international level a majority is not enough: that needs unity. This is why they are not holding referendums in Paris or Los Angeles. And this is why never in the history of the Summer Olympics has the right to host the Olympics been awarded to a city in which there was a referendum on the issue; because a majority is not enough – what is needed is unity. Imagine that the candidates are standing there side by side. Paris, Los Angeles and Budapest: two large, strong and united countries; and Hungary, which has just arrived following a dispute over the issue. Who is going to vote for us? What we happen to have voted for here at home is our business. But there, in the international jury, who would state that it would be better to hold the Olympics in Budapest, rather than in Paris or Los Angeles? We probably wouldn’t receive a single vote. And that would be a big disgrace. So being beaten is one thing, but it makes a difference how much one is beaten by – and we would have been beaten to a pulp. And I believe that the country should not have to face this danger, such a loss of face and disgrace, because we deserve better. We would have presented an excellent bid, we would be ready for it and our hearts would be open: we would truly want to do it. And then the outside world would downgrade us to no votes – or to perhaps just a couple – while the other two candidates would receive votes of confidence; this is something we should not expose ourselves to. This would be the disgrace: the possibility of a shameful defeat.
Has it become a political issue? One organisation has profited a lot from this; they came out of nowhere and have become well known.
Right now one’s heart is bleeding, because there are many in Hungary for whom this has long been a dream – and it certainly has been for us. The Olympics is perhaps not everybody’s dream – naturally we aren’t all the same – but for many Hungarians it undoubtedly is. In any event, those dreams have been murdered. And indeed there is a political organisation that hasn’t even tried to conceal the fact that it doesn’t really care about the Olympics, but wants to form a political party and enter the political arena. To do this it was even prepared to become a murderer of dreams. That is their business; there is freedom in Hungary, it’s their responsibility, and it’s their decision. I have been in Hungarian politics for thirty years, I’ve listened to them now, and – let’s not beat around the bush – they are the new SZDSZ. If someone listens to them or watches them on television, they’ll see that this is the new SZDSZ. And we also know what comes next, because we’ve already experienced that too: a little elbowing with the MSZP, and then an MSZP-SZDSZ coalition. This is what we can expect.
Will there be an Olympics in Hungary during your political career?
Well, according to modern medical science, the limits of human life are extending – so I have a good chance of living to see that.
Let’s talk about reductions in public utility charges. This was one of the dangers you spoke about in your “state of the nation” address. Practically speaking, Brussels has a response to this: they don’t really understand why reductions in public utility charges need defending. Firstly, they say, because in fact they’re only intervening in fees for use of the system, and they don’t like the fact that the public and industrial consumers are paying the same rate. Secondly they add that, to all intents and purposes, world energy market prices and the fall in those prices means that consumer prices will also fall, so there’s no need for state-regulated reductions in public utility charges.
Yes, but the issue isn’t that complicated – it’s much simpler. The question is, who should decide how much the Hungarian people pay in their utility bills? Should this be decided in Brussels or in Hungary? All further analysis is superfluous: the simple question here is who should decide. And I think this should be decided in Hungary: by Hungary’s parliament and by the Hungarian government. And that’s that. Whatever way you look at it, the fees for use of the system are just minor technical issues in comparison. The real question is that currently the right to decide is here in Hungary and in Budapest, and they want this right to be transferred to Brussels. I see no arguments to justify our accepting this. Why isn’t it perfectly good to keep it here, where it is now?
But then we’re talking about a question over who decides on something affecting many areas and regions in the coming period, not just Hungary, and on the relationship between Brussels and the Member States.
Well, that’s true, and as things stand the European Union’s institutions in Brussels – let’s just call them Brussels, or the Brussels bureaucrats – are continuously plotting to transfer as many spheres of competence as possible from nation states to themselves. Transferring ever more decision-making powers from nation states to a Brussels headquarters above those nations is seen by them as the essence of the European process. In my view this is not what the founding treaty of the European Union is about, and it is something that nobody has consented to. The founding treaty and its various amendments clearly state who has rights over what. This must not be taken from nation states furtively and by stealth – but this is exactly what is happening on a continuous basis. So we must prepare for the fact that the European Union – which, incidentally, I see as an extremely important institution, which Hungary should be a member of – is not a realm of heavenly peace, but a battle zone. In this battle zone we must continuously struggle with the bureaucrats to prevent them depriving the Hungarian people of rights that are in a much better place here than they would be in Brussels.
Do you think this is also why eliminating tax competition is on the agenda once again – or is Brexit the reason?
Well, Brexit represents a problem, in that there are many in the EU – though Hungary isn’t one of them – who want to punish the British. This is something that we Hungarians find difficult to understand, but we’ve never been neighbours to Great Britain, and obviously in certain countries there are national feelings which are unique. We were on opposing sides in the Second World War, and we too have bad memories – or, rather, we too have our share of bad memories; but, aside from the historical background, we have fundamentally always had a good relationship with the British. The British have some good characteristics that are becoming increasingly rare around the world. In essence they stand on foundations of common sense, for example. They are a fundamentally a conservative people, which means that they don’t change their country on a whim, but consider things very seriously before changing anything; or – as we also say in Hungary – they measure twice before cutting once. As well as being strong and wealthy, they have many good traits, and we don’t think that the European Union should allow there to be bad relations with them after they leave the EU. So it doesn’t pay to be offended or to punish the UK; it’s not in our interest to ruin or weaken them, because they’re not our opponents, but a political unity that is now independent of us, and with which we must develop a good relationship. This is why we say that we want a fair Brexit, we would like a fair and equitable cooperation and withdrawal process. We should be wishing the British good luck, instead of snorting like a resentful little hamster. So let them follow their own path – that is something which all peoples have a right to do. They are a courageous people, they have decided to take a different path, and we wish them well. So this is not the determining factor. The determining motivation behind standardising tax regulations is that there’s a problem in the Western European economies, while Eastern Europe is extremely competitive. So if you look at a map with economic data you’ll see that Poland, the Czech Republic, Slovakia, and Hungary – since 2010 – provide a substantial part of Europe’s growth, its economic growth. This is where new jobs are being created: in Hungary we will soon achieve full employment, and the situation is also good in other Central European countries. So we are competitive. And ever more Western European, German, French and other nations’ companies are deciding that if they do the sums and take a look at where they will be better off, then – thanks partly, but not exclusively, to the tax system – it makes better sense to set up factories in Central Europe rather than at home. And of course this generates major disputes back home, because trade unions don’t like jobs being taken abroad – which is also understandable. Businesses will pay their taxes here in Hungary, something their home governments are not happy about. Again, this is understandable. But we must decide what we want. We cannot speak with two tongues, and we cannot profess one thing and its opposite at the same time: we either want a unified European Union in which investments can move freely, or we don’t. If we want it, then we must accept the resulting competition. This is a competition, and one that Hungary has accepted; we began from a worse position that the Germans, French or Italians, who were wealthy and had huge numbers of private businesses, while we only had the ragged heritage left by communism. This is where we started off from. Compared with that we are now competitive, and they do not want us to withdraw investments from Central Europe. There is an ongoing competition for investments; I believe this is a good thing, and, instead of banning it, this competition should be fought fairly.
To simplify things, one of the issues you are highlighting is the question of whether or not we want a unified European Union – while at the same time Brussels objects to, for instance, corporation tax allowances in Hungary which are so favourable that they result in us attracting large companies from France or Germany.
This is one of their objections, but they have another too, and it resonates especially strongly when I listen to the Chancellor of Austria. First of all the Hungarians are prepared to work hard, to work a great deal, and are prepared to work abroad. So a unified Europe also means that citizens from different states can go and work in the territory of other countries. Of course in this respect we usually think first of ourselves – that’s human nature. But in fact this is not a Central European phenomenon. For example, there are many more Germans working in the European Union but outside Germany than there are Hungarians working outside Hungary. This is something we rarely think about. Western Europeans are also working all over the place, in each other’s countries. Of course Hungarians and Central Europeans come from a more difficult situation and are prepared to work harder, are more flexible, and are also prepared to accept lower salaries. Of course this causes tensions in the countries they go to work in. But here again, we must decide whether we want a European Union – which also includes this phenomenon – or we don’t. It is not acceptable, for example, for Austria to want their capital to be able to move freely to Hungary, to make a profit which they can take home if they want to, but at the same time to object to Hungarians going to work in Austria. In the European Union the free movement of labour and the free movement of capital are interlinked. And if Austria wants to punish the Hungarian people, then we will punish Austrian capital.
Yes, but what people with calmer heads say to this is that the situation shouldn’t be exaggerated: according to the Treaty of Rome, a veto by a Member State is enough to block any plans to do away with tax competition.
That’s right, and we too have the power of veto, which we will exercise if required.
But then why has this fear – if we can call it that – gained renewed strength once again?
Because we’re talking about such a devious regulation. People must understand that not all issues are spoken about as openly as we are doing here and now. Not all conversations are like the one we’re having now, which aims to present the extent of the problem; often there is some sleight of hand. First they change minor regulatory details. For instance, look at what’s happening in Austria now. The Austrians have come up with the following idea – and to me it seems that it’s currently under discussion. According to this, a Hungarian working in Austria and paying taxes and social security contributions there – but whose children are not there with their parents – should not be eligible for the same family benefits as an Austrians is. This would be despite the fact that both Austrians and Hungarians pay their contributions. This is something we must debate. So these people do not put forward the question like we do, presenting the broader picture, but attempt to change minor details of regulation by stealth. Now this is what I call the covert withdrawal of spheres of competence and the amendment of treaties – of the founding treaty of the European Union – by stealth. This is something we’re not prepared to accept. This is why we must always exercise our power of veto and say: “Look, let’s raise the issue openly and see how we can reorganise the European Union to make it better for everyone. But let’s not go around amending the founding treaty in an underhand way. Let’s talk about it openly and straightforwardly”. The reason the EU is suffering from crises today is that nobody’s keeping to the rules. The Germans and the French were allowed to exceed budget limits. This was mostly kept quiet. Then the Greeks were exempted from financial regulations. After that the Greeks and the Italians were allowed to ignore the Schengen regulations. And then the Germans themselves disregarded the Schengen regulations, by allowing in illegal immigrants. We continually break our own rules. This is why the European Union is suffering today.
Why do you think that Brussels is looking to do something similar on job protection support?
The European Union regularly prepares reports on its Member States – more often on some than on others. In these reports a recurring criticism of Hungary is the public work scheme, which is a form of job creation. First they attacked the Jobs Protection Action Plan, which we have now successfully defended, and now they’re objecting to the support that the Hungarian state gives certain companies. They call this “unjustified” or “unauthorised”, and they claim it distorts competition – even though it is also provided by other countries. But it is in our interests to provide funding for certain investments, including from the Hungarian budget, because this is one of the ways in which jobs for Hungarians are created. Now they’re trying to restrict our opportunity to do this. This has been a recurring issue for some years, and now it seems that the attacks are gaining strength again. So in the period between Christmas and New Year, when I was preparing for 2017, I thought about what we must prepare for; and of course there are opportunities that we must exploit, which we’re not talking about today, and there are dangers that we must avoid. It’s natural for people to want to defend their security, to protect the things they’ve already achieved and to defend future opportunities. And then I pinpointed the four or five threats and dangers that we must protect against. And I saw that protecting our tax system will definitely be one of the most important tasks for 2017, as will be the issue of migration; and there are a few other danger points.
Since you mention the public work scheme, I know that the Government is still fine-tuning the system – or, to be more precise, the Ministry of Interior has been carrying out surveys on this. In many respects this could in fact serve as a solution for labour shortages, which we are also experiencing. So in areas with a lower unemployment rate than the national average and where a large proportion of people in the public work scheme are relatively well-qualified – who have finished school or who have a vocational training certificate, for example – can you imagine these people not being able to find a job in the public works scheme?
One must be careful on this. Naturally it is in all of our interests for as many people as possible in Hungary to have work opportunities, because if there is work, there is everything, and work should be paid increasingly well. For instance, this January pay rises were introduced, the minimum wage and minimum wage for skilled workers were increased; these wages are being increased by unprecedented amounts. We are doing this precisely to ensure that everyone feels that it is worthwhile to work. And for precisely this reason it is also in the interests of us all for as many people as possible to be able to move up from public work into better paid jobs. This is in the interests of people who are working in the public work scheme, and it is also in the interests of us tax-paying citizens. So in my opinion this is a national cause, meaning that this process must be facilitated. How to combine stricter regulations with making work more attractive, and the correct policy for this, is a technical issue for the experts. But we should certainly agree on the goals: that it is good for as many people as possible to be able to work in full time jobs and earn as much money as possible. But there is also another reality which we must face: in all societies – be they large or small, Western or Central European – there will always be a certain number of people who are unable to find work in the job market. There are several possible reasons for this. There may be personal problems, and lives may have been ruined; lots of things can happen to a person in the course of their life. And there are always a good many people – tens of thousands usually – who are unable to find work in the usual, commercially-based job market. If they are capable of working, the question is, should we offer them benefits, or instead offer them a job opportunity? We are building a work-based society, and instead of benefits we are providing them, too, with the opportunity to work. So there will always be a need for public work, because this is something stemming from human nature. The only question is one of proportion. And I believe that the optimal proportion is one in which only those people are in the public work programme who are truly unable to find a job anywhere else. But this has not been the case in recent years, because only now are we approaching full employment, when labour shortages appear more regularly within the economy than labour surpluses.
Do you believe that there is a difference between one non-governmental organisation and another?
This will be one of the interesting issues of the coming year. Here in Hungary, what we refer to as a “non-governmental” or “civil society” organisation is one organised by citizens on a voluntary basis through commitment to a certain cause, which attempts to raise the profile of that cause and also make decision-makers deal with the issue and make decisions favourable to that cause. There are a great many non-governmental organisations in Hungary – some sixty thousand in fact. We usually think that we are too individualistic, selfish and divergent – and these are certainly characteristics within us. But in contradiction to this there is another side to the coin: there are, after all, some sixty thousand non-governmental organisations in Hungary. These are volunteers who are trying to help society, their environment, their home towns and human relationships. This is a great thing and a great asset for Hungary, so hats off to the non-profit organisations! In contrast with this, there are international networks that call themselves “civil society”, which set up local offices in various countries, which recruit activists and also usually pay them, and which represent international interests – usually the interests of global, international capital. They call themselves “non-governmental organisations”, because they want to hide behind the backs of non-profit organisations, as being a volunteer non-governmental organisation is a good thing: something noble, which deserves praise. But what they are doing – trying to represent the interests of international capital in certain countries – is less worthy of praise; and therefore this is something they do not boast about. One of the topics of the political season ahead of us will be this phenomenon and how to handle it. In fact it wasn’t even we Hungarians who put this issue on the agendas, but the Americans. The US presidential election took place before our eyes, and one of the issues for debate was whether international organisations – international organisations funded with foreign money – had influenced the US presidential election campaign. This is still a subject of heated debate in the Unites States. And looking at the French election campaign, this issue has also come up there. So what I would like to establish is that we’re facing a general problem in Western democracy, which we are not independent of, and which we must also deal with. Of course we shouldn’t cross the red line, but what the Hungarians can certainly state is that we are also capable of deciding – as we have proven on many occasions – what should happen with Hungary. And people who receive money from abroad to influence Hungarian politics should admit this fact and make it public: they should be transparent and should be accountable, just like political parties. Hungarians are right to demand this.
Is this also true for organisations that receive funding from the Hungarian government – for instance organisations beyond the borders?
No, because organisations beyond the borders are suitably regulated: they are transparent and accountable to the public.
So what you are talking about in fact is transparency and consistency – not that they shouldn’t be receiving money of this kind.
Well, that is how the world works – I have no say in that. What we want is for Hungarian people, when they come to a decision, to be able to assess every argument and every phenomenon. We want to help the people of Hungary gain a clear view of life in Hungary; and when they decide – for instance in a parliamentary election – then they know who is talking, who’s who and why they’re saying what they’re saying. Making this transparent and presenting it in some way is a democratic value.
These international organisations are working in quite large numbers along the Balkan migration route or on the Hungarian border. On the one hand, refugee detention means that for many reasons – but especially because of the increased threat of terrorism migrants represent – we can vet them people they arrive at the external border. But of course this breaks down when the European Union opens and liberalises the process, as is the case now. Meanwhile I cannot move freely within the territory of the European Union.
Well, here’s the problem. For the past twenty-odd years we have tolerated the existence of these NGOs – or these international organisations funded by international capital. They’ve always been here under our skins or our nails – like a splinter. But we coexisted with them. What is too much, however, is their behaviour in relation to migration. Hungary cannot afford to allow organisations lurking in the shadows – who don’t declare who they receive their money from and for what purposes – to continuously encourage migrants to break Hungarian law and somehow get into Hungary. So the people of Hungary have decided on our migration policy: that we will not allow anyone in without adequate control; that we will build a fence to stop them; that we will defend our security. Despite this, organisations with affiliations to international capital – and particularly George Soros – are working tirelessly to weaken Hungary, to penetrate the border and to bring migrants into Hungary. With this I think they have overstepped a line. This is why we need to deal with this issue now. Of course the EU is slow and is moving in the wrong direction; or perhaps I could say that, since it is moving in the wrong direction, thankfully it is slow. So, instead of forcing the Greeks and the Italians to protect their borders, and acknowledging us – or rather acknowledging our efforts and the fact that we, in contrast, are defending the external borders of the Schengen Area – they are introducing a new regulation, or at least that’s the plan. According to this plan they will be harassing EU citizens on the border. So we will have to introduce systematic passport checks for European Union citizens entering Hungary at our borders with Croatia and Romania. This will lead to delays of up to eight to ten hours at the Hungarian border – especially in summer. This is not good for the Hungarians and it’s not good for the Croatians; it isn’t good for anybody.
Such checks already exist.
Yes, but they are spot checks, they aren’t systematic. What the regulations will state is that everybody’s passport must be taken and placed in a scanner, so a whole passport examination procedure will be compulsory for people who have European Union passports. Illegal immigrants are continuously being allowed into Europe, and meanwhile we law-abiding citizens with passports are being forced to undergo full screening. It’s a nightmare. And the EU wants to force this on us. We are very close to this decision either being adopted, or successfully blocked. This would cause the Hungarians a lot of misery, especially in the summer – and not only Hungarians, of course. This is why it is in our fundamental interests to make Brussels see reason on this issue.
For the last half hour you have been listening to Prime Minister Viktor Orbán.