Today is one of those days that I have no idea what will happen between beginning to write this post and uploading it. One thing, however, I can be pretty sure of: I don’t have to worry that by tomorrow morning Viktor Orbán will not be the prime minister of Hungary. Although that is what the opposition would like to see.
This morning’s editorial in Népszabadság demanded Foreign Minister Péter Szijjártó’s resignation. And, indeed, Szijjártó’s situation was deemed so grave that Prime Minister Viktor Orbán himself came to his rescue. At a press conference in Sopron he said that he was the one who decided that all government money invested in bonds issued by private financial institutions must be withdrawn immediately. He announced his decision at the Thursday, March 4th cabinet meeting. The Hungarian National Trading House subsequently withdrew 3.8 billion forints from Quaestor on Monday, March 9th. That very evening Csaba Tarsoly, CEO of Quaestor, announced his firm’s bankruptcy.
The problem with this story is that it doesn’t jibe with earlier statements of the ministry of foreign affairs and trade that praised the Trading House officials who “acted conscientiously when, observing the market developments,” they opted to withdraw Trading House’s money from Quaestor. Because, according to the letter the ministry sent to cink.hu, there was real panic in the first days of March “when the majority of Quaestor’s clients began withdrawing their assets.” The problem with this explanation is that it is not true. There was no outward sign of trouble at Quaestor at the time. Once Orbán decided to bear the odium of what appeared to be insider trading on the part of government agencies, the ministry discovered that its earlier explanation did not accurately reflect the situation and that in fact the prime minister’s version was the correct one.
Many political reporters were stunned when they heard that Orbán had decided to be the fall guy in this scandal. “In the first moment I didn’t understand how [Orbán] could do something like that,” László Szily of cink.hu said. M. Kasnyk of 444.hu at first couldn’t believe that the story was true. After all, with this admission Orbán threw himself into a quagmire of monumental proportions with a possibly serious political fallout. But it seems that Viktor Orbán is confident about his invincibility. He thinks that his position is secure and that he has nothing to fear. Given the Hungarian parliamentary rules he is probably right, although the opposition parties appear to be united in demanding his resignation.
As we learn more about the events leading up to the collapse of Quaestor, it seems that the Fidesz political leadership had been aware that Csaba Tarsoly’s financial empire was in serious trouble for some time. A high-ranking member of the Fidesz parliamentary caucus told an Index reporter that it was likely after Buda-Cash’s collapse that there would be other bankruptcies. He specifically mentioned Hungaria Értékpapír and Quaestor, both of which subsequently failed.
But let’s return to why Viktor Orbán decided to speak up. Most likely because he realized that Péter Szijjártó was in big trouble. He had illegally invested government assets in a shaky private business venture and then, presumably equally illegally, had withdrawn 3.8 billion forints just before Quaestor’s collapse. Orbán gave this young man a critically important position, one that he was not prepared for. But Orbán is not the kind of man who would ever admit that he made a wrong decision, and therefore it would never occur to him to remove Szijjártó from his position. Also, Szijjártó served him with undivided loyalty for such a long time that perhaps Orbán feels obliged to defend him.
Viktor Orbán announcing his decision to withdraw government assets from Quaestor
Let’s take a quick look at the opposition parties’ reaction to Viktor Orbán’s announcement. Párbeszéd Magyarországért/Dialogue for Hungary (PM) was the first to announce their decision to press charges against government officials who, they believe, are guilty of insider trading. Tímea Szabó, co-chair of the party, naively said that they will demand the audiotape of the March 4th cabinet meeting. Good luck! As far as I know, no records of Orbán’s cabinet meetings are kept in any shape or form. Orbán made that decision already in 1998 when he first became prime minister. He didn’t want to become a second Nixon.
Együtt/Together decided that, while they were at it, they might as well send Péter Polt, the chief prosecutor, into retirement alongside his old friend, the prime minister. DK is also pressing charges, and they “would like it if the prime minister would assume financial responsibility with his own assets” for the losses at Quaestor. LMP’s spokesman, a practicing lawyer, talked about insider trading, which is a serious crime and for which long jail terms are normally handed down. He even offered an explanation of what might have happened. In his opinion, it was through the close relationship between Szijjártó and Tarsoly that the information leaked out and spread within the Orbán administration. He also raised the possibility that with the ministry withdrawing about 20 billion forints, Szijjártó may have been partially responsible for the collapse of Quaestor. Gábor Fodor of the Liberális Párt (LP) wrote a letter to the prime minister which Orbán will have to answer at the latest in three weeks’ time. Fodor wants to know exactly how Orbán ordered the ministers to withdraw government assets from private firms. Was it in a letter and, if yes, who were the addressees?
Modern Magyarország Mozgalom (MoMa), the party of Lajos Bokros, called the Hungarian state under Victor Orbán a “den of criminals.” He called attention to the seriousness of insider trading for which “in the United States and in Great Britain people receive very long jail sentences.” In Hungary, he claimed, important government officials are involved in such practices. Bokros also wanted to know “how the ministry of foreign affairs and trade has extra money to invest.”
Several MSZP politicians talked about the case and they all called for Viktor Orbán’s resignation. Jobbik’s János Volner, chairman of the parliamentary committee on promoting entrepreneurial activities, plans to convene a meeting where he expects Péter Szijjártó and the leading official of the Hungarian National Bank to answer the committee’s questions. If they don’t get satisfactory answers, they are ready to go as far as the European Union.
Fidesz is stonewalling. The party “doesn’t fall for the socialists’ provocations because after all it was the left that in the socialist broker scandal [i.e., the Buda-Cash collapse] abandoned the Hungarian people.” And in any case, “it is MSZP, Gyurcsány and Bajnai who are involved in the network of brokerages.” I have no idea what the Fidesz spokesman is talking about here.
The last piece of news I read before sitting down to write this post said that MSZP is inviting all other opposition parties to a meeting tomorrow. We will see what the reaction to this call is. If they manage to form a common front, it will be a first.