J á N o S L á Z á R
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t is always an important opportunity for a government when it can expand upon its thoughts to those concerned with scientific and public life. I would like to take just that opportunity in this lecture and speak about the government’s thoughts on the present crisis, and about our feelings in this situation. I would like to thank Mathias Corvinus Collegium and specifically the founder, András Tombor, whose work I value highly, for this occasion.Firstly, I would like to make a personal comment on how one of the representatives of the Fidesz-led government is feeling in the crisis, and how the members of the government feel. It should be known that Fidesz is a freedom fighters’ party – it was founded in order to overthrow communism and overthrow the regime of János Kádár, so the government always feels splendid in hard times, in times of crisis and in times that call for a fighting spirit. That means we always feel splendid in times when there is a need for innovation, creativity, freedom-fighting spirit, some revolutionary work, resistance, home defence and the dismantling of an old system.
Those who feel mentally or ideologically committed to Fidesz, those who are its founders or organizers, are feeling splendid, they are enjoying the situation immensely. But there is another completely different question: To what extent is our country suffering from the crisis? For a politician or a public figure, crisis means demolishing something old and bad, and building something new. It must be declared: every crisis situation is also a historic chance. A true politi-cian, who has politics in his blood, regards the situation not only as a threat but also as an op-portunity. He does not only see difficulties, trouble, problems and crisis, but also the opportu-nity to change a bad system.
Members of the Fidesz party are never status-conservatives; they always have an inclination for creative and innovative solutions, which means that in an intellectual sense, crisis for a politi-cian is always a test, a trial and a challenge, i.e.: a great opportunity. On the other hand, the crisis creates a new line of business, as conferences dedicated to it can be organized, which may even have books as spin-offs, like this one. Crisis tourism and crisis conference tourism can be interpreted as positive consequences of the crisis. However, before you begin to think – based on what I have just said – that a completely frivolous man is leading the Prime Minister’s Office, let me share with you what will be included in my summary. I will raise two questions: Why did Europe remain in crisis after the global financial crisis of 2008? And how is it possible that Eu-rope is still struggling with the crisis, instead of getting out of it?
It might be an important side story of intellectual history, and it is worth warning ourselves and Hungarian society of the fact that the European Union was created to solve a crisis, to re-solve a conflict, and to establish long-term peace after the Second World War and lay the
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foundations for sustainable economic growth. It is quite shocking that the organization and structure set up to solve the major problems and handle the most challenging crises of the twen-tieth century are themselves in the most serious and most unmanageable crisis of their history.
How the European Union, created to cure the traumas of the First and Second World Wars, got into a crisis may later become an important area of historical research. Added to this could be the fact that its right to existence and its future are being questioned nowadays. This is a rather gripping question in itself.
We can clearly see that in today’s Europe – and I believe that this is the real dilemma – the main crisis is not a democratic crisis but a social one. That is because today the crisis has also hit the mentality and vision of the European Union that found the redistribution of resources and goods in the form of the social welfare state, as well as in strengthening the middle classes to be in the spirit of justice and fairness. I would just like to remind you that the previous unfair dis-tribution of resources and goods before 1945 led to the world wars that nearly destroyed Europe and European civilization. Thus there is no auspicious European future without social peace.
We presently find ourselves in a situation where states on the periphery of the EU have to struggle with an unemployment rate exceeding 20-25%, with untreatable social tensions, and with worrying social problems, all of which also lead to grave political consequences. I think – and it is safe to say this after a twentieth century full of serious disorder – that it is the vital interest of we Hungarians that European ideas should be reinvigorated, that there should be more Europe in the sense that social justice should be continent-wide, and that the fair allocation of resources really should take place because without that, we will have to deal with crisis situations again and again.
One of the most spectacular signs and consequences of the current crisis is the fall of the reigning governments. Since 2008, apart from a few exceptions, virtually all of the European governments that were seeking to resolve the crisis have failed. Ireland at the beginning of 2011;
Portugal in June 2011; then Slovakia in October; Spain, Italy and Greece in November; and fi-nally Slovenia in 2012. These were either government crises or the failure of the previously reigning parties at the elections. President Sárközy lost the election in France in April 2012. In October of the same year, the former Lithuanian government party was also defeated at the elec-tions. So one of the real morals of the crisis that governments should take into account is that there is practically no cabinet in Europe that has been able survive the crisis and maintain the support of its society in the past three years. No government could do that. A major issue of 2013 is whether or not Chancellor Angela Merkel will be able to ensure political stability, and wheth-er or not she will be able to continue leading Gwheth-ermany, and thus establish a standard for Euro-pean politics and a set of values in the EuroEuro-pean Union. The German elections are therefore very important, and they will have a real impact on our existence here in Central Europe as well.
So there is an acute political situation, and, naturally, there are some theoretical and philo-sophical questions as well. I think that the crises, which have hit Europe in waves since 2008, have serious consequences for the state itself as well as for the structure of the state. I am positive about the fact that the inert, overextending, corrupt, only regulatory, impotent and incapable state made its contribution to the crisis to a significant extent, so it is inevitable that we have to come up with a new answer to the question of “What should the state be like?” In my opinion, the main elements of this are the following: a strong and small but active state is needed, and, according to our philosophy, we must reinforce its balancing, active and intervening role. This state should also be intelligent and capable of integrating the many diverse interests, and be limited by social and civil control. At the same time, it has to be stable, open to inspection, exact,
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precise and accountable, and the various well-distinguished branches of power must work to-gether professionally within the state. Yet we must not forget that the classic task of the state cannot change: economic and social resources must be managed and redistributed with transpar-ency and in the interests of the public good.
In this lecture, I would rather we did not pose the delicate question to ourselves of how the past two years of our governance can be put into this framework. Of course, there are signs that clearly point in that direction, but it must be borne in mind that the current government is still at the start of the road and that it works to the detriment of acceleration that a twenty-year-old, counter-productive state model has to be systematically dismantled together with an also twen-ty-year-old, outdated philosophy of governance. I firmly believe that if the entire political class does not become more modest, that if the political group leading the country does not become less elitist, and that if the whole of politics does not relinquish its pseudo-democratic nature, it can directly lead to radicalization and the strengthening of extremist political groups. So we have to change the style of politics. In Fidesz communication, simply put, this is plebeian politics: the core of it is that the politicians and the upper world of politics cannot become separated from reality and from their own society. We need the kind of political elite that does not use its power to serve its own purposes and to promote the aristocratic politicians’ lifestyle, but is capa-ble of showing sufficient humility to society. We have been acapa-ble to see signs of just the contrary in Europe over the past 20 years, and the Hungarian political elite – including myself – also has to practice self-criticism.
Another very important issue in this context is the fair distribution of burdens. Perhaps this has been the most successful area of governance in the last two years. A crisis is perfectly suited to rais-ing the followrais-ing question: Who pays the ferryman, who should pay for the crisis, and who will ensure the funding of the society? I think that the principle which means that different players in the economy should be involved to a greater extent in the fair sharing of public burdens can clearly be supported. Of course, liberal economic philosophy might question the correctness of the high-volume and tough taxation of certain, privileged economic circles – the banking sector, the energy sector, the commercial sector, and multinational companies in particular. If, however, the question is how a government can retain the trust of society, or how a politician in a crisis situation can regain this trust, then the only pragmatic – and just – answer is that every player has to have a fair share of the burdens in relation to endowments and capabilities. The winners of the past twenty or twenty-five years have to bear more burdens on their shoulders in Hungary in the future, and it would be good if the situation was the same in Europe. This is a very important point which naturally goes against the economic philosophy and practices of policy upon which the Anglo-Saxon world, or even a significant part of Europe, has been based during the past twenty to thirty years, the economic results of which established the countries’ welfare. However, if the financially strong sectors do not contribute more to the common burdens to be borne, then we can be certain that political stability will weaken, meaning that all governments will fail at the next election at the latest, as people regard the current situation as being unfair.
It is very hard to tell citizens – and I think some of the Western countries are struggling with this problem – that the most important consequence of the crisis on German, French, Spanish or Italian voters is that they will not live as well as they did before. Because the final question is whether or not the prior standard of living can be kept up. Politics is in a very tough situation when a society brought up in wealth has to be confronted with this polemical issue. It is already a tough situation when society “only” has to be urged to do more work. In Hungary, people now have to
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be confronted with precisely that fact: that they have to work more for the same salary, or at least it is uncertain whether the state or the economic players can pay more money for more work. This huge social conflict does not give a lot of hope to any of the governments that they will be able to retain the trust they had before at the next elections within the given political structure.
So far, I have sketched my opinion about the problem arising at the European level and the dif-ficulties it poses to us; now I would like to share some of my basic thoughts about the crisis itself.
There is a whole library of literature on the theory that regards world history as a historical chain of crises and that considers the emergence of crises from time to time as a part of the natural life cycle of historical development. These crises may lead to the fall of empires, cultures and civi-lizations but they also present the opportunity for the birth of new civicivi-lizations. The scholar deal-ing with this topic has an exceptional opportunity, as the current Hungarian situation presents him with decades of research material. Thus, to write the history of the current crisis will be a challeng-ing task for the historians and the economists of the future. Today’s literature on the topic is also diverse, there are many scientific papers that deal with different aspects of the crisis, but there is one point on which all of them agree: no matter whether we are talking about twentieth-century crises or earlier ones, a crisis is always a moving target, it is unsteady, hard to aim at, and we are never sure about when it will end. There is no one in Europe or anywhere else today who could safely say when and, more importantly, how the present crisis will end.
When the European Union asks the Hungarian government about the budget deficit to be expected for 2014, let us practice some humility and modesty. We are happy if we can even es-timate the budget deficit for the first quarter of 2013, so it might be impossible to eses-timate the budget deficit for the fourth quarter of 2014. I doubt whether anyone can see into the future in such a way, as the crisis is a dynamic phenomenon, and we still cannot tell what it entirely de-pends on. Yet it is quite certain that there is an enormous responsibility on us politicians – and clearly the keyword here is responsibility.
One of the important secondary symptoms of the crisis is that average voters’ expectations of the state are becoming higher. Citizens want more from the government in a crisis; they want the government to protect them under all circumstances. This means that the responsibility of the state is much higher during a crisis, as the standpoint of the citizens is clear: they “keep” the state with their taxes because they want protection at times of problems or of crisis.
Parallel to this, there is another question: Whether or not the states (including Hungary) have been able to protect their citizens from the symptoms of the crisis and whether or not they have been able to tackle the issues and reduce vulnerability in the past two or three years. I think our government has been driven by these goals. When people do not understand what their govern-ment is doing in the energy sector, in the banking sector or when allocating resources, it should be primarily explained to them that there is a very important principle: one cannot talk about norma-tivity in a crisis, as there are only ad hoc solutions at such times. However, it needs to be empha-sized that the most essential key principles of these ad hoc solutions must be for nothing else but the protection of the voters.
Today it is a commonplace that civil aviation totally changed after 9/11, radically transforming the everyday social lives of all those people who book flights. Also, after the collapse of Lehman Brothers the regulation of certain bank transactions and financial processes changed fundamentally compared to the transactions before the fiscal crisis. So we can be very sure that as a result of an economic or social cataclysm, significant changes will occur in the life of a nation, which of course is also a huge opportunity to transform that country. Let us examine an example. In the United States, twenty years
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ago it would have been unthinkable that a presidential candidate would win the election if he had said that a based health insurance system would be introduced. If someone had argued for a risk-based health insurance system at the time of Ronald Reagan, he would have been simply called a communist. And of course, some people nowadays call Obama a communist, but it has turned out by now that he was able to not only build the system, but he was also re-elected at the last election, even though people knew what he had done. This process is obviously not independent from the fi-nancial crisis that is so typical of the Euro-Atlantic world, so to say that the fiscal crisis does indeed have an effect on capitalism as it is today is by no means a daring statement.
We can love or hate capitalism, but we have to admit that throughout the centuries it has resulted in Western societies having better living conditions and being able to develop techno-logically. At the same time, like all systems, this system is not static but it has been changing dynamically and will change in the future, too. Today we are living in a time of rapid changes.
I believe that the most important sign of this in the sphere of political power is that as a result of the crisis, the governments of the individual states – no matter whether they espouse left-wing or right-wing principles – are becoming more and more active, they are given the opportunity (which is of course their duty as well) that if they are serious about the responsibility felt for their society, they can change the basic operating principles of a given country. It can be observed that those governments that in the competition between orthodoxy and unorthodoxy choose change are working on creating a more active and efficient state, regardless of their party affiliations.
I believe that the most important sign of this in the sphere of political power is that as a result of the crisis, the governments of the individual states – no matter whether they espouse left-wing or right-wing principles – are becoming more and more active, they are given the opportunity (which is of course their duty as well) that if they are serious about the responsibility felt for their society, they can change the basic operating principles of a given country. It can be observed that those governments that in the competition between orthodoxy and unorthodoxy choose change are working on creating a more active and efficient state, regardless of their party affiliations.