Fear And Loathing On The Eastern Shore

Michael Hedges January 4, 2011 - Follow on Twitter

New laws taking effect with at New Year in Hungary attracted considerable attention from media and political commentators. Twenty years after escaping the Soviet Union’s grip, the authoritarian style of government is back in favor bring with it the urge to control the media sector. It’s not pretty but it’s easy to understand.

The Media Act passed by the Hungarian Parliament (December 21) and signed by President Pal Schmitt (December 30) drew biting words from several European government leaders, led by German politicians, and media watching NGOs. Particularly grating, if not outright frightening, are provisions for large administrative fines for vaguely defined sins by newspapers, broadcasters and websites.  Not being “politically balanced” and devoting more than 20% of news broadcasts to crime stories can draw fines to €700,000. The Hungarian music quota for radio stations was raised to 35% of hourly output.

The law actually uses the term “fair and balanced,” an ironic tip to the News Corporation owned veracity-challenged US Fox News channel. Crime news, said the text, is “depressive, elicits fear and has a negative impact.” Reporting official corruption falls under the crime news heading.

Reporters can also be forced to reveal sources. The text, yet to be officially translated into languages other than Hungarian, appears to give the media regulator authority to fine foreign-based news organizations, including websites. The newly formed Hungarian media regulator, essentially managed by Fidesz party loyalists, has authority over all media content.

Prime Minister Viktor Orban and his spokespersons met this with the confidence of politicians with the support of the Hungarian majority. He is an extremely deft politician who understands that all politics are local. In 2010 parliamentary elections the Fidesz party won a majority sufficient to change the Hungarian constitution. Orban became, for the second time, Hungary’s prime minister, the ninth since the fall of the communist State.

PM Orban has made plain his populist, nationalistic agenda. During the election campaign he promised that foreigners would never own agricultural land. His immediate predecessor, Gordon Bajnai, had been CEO of an investment company tied to a major poultry producer that collapsed as well as a national commercial radio channel. Similar entanglements have rattled to the surface throughout Europe, not confined to the East.

In a bid to streamline media and telecom regulation and its disposition the government merged National Communications Council (NHH) with the broadcasting regulator ORTT into a new agency, the National Media and Telecommunications Authority (NMHH), known locally as the Media Council. Fidesz operative Annamária Szalai was named to head the NMHH.

Also announced in August was the radical downsizing of Hungary’s public broadcaster, recombining radio and television with all news programming produced by State news agency MTI.  Assets of public radio and television would be transferred to the Public Service Public Foundation, managed by the new Media Council.  All operational aspects would be transferred to the Program Provision Supporting and Asset Management Fund, also managed by the new Media Council. Successive governments have attempted to overhaul public broadcasting with its legacy in Soviet era State broadcasting. The previous Hungarian government sold the Budapest public television headquarters building to a hotel developer, evoking public protests. Riots following former Prime Minister Ferenc Gyurcsany’s surreptitiously recorded confession in 2006 broadcast on public radio that he’d “lied in the morning and lied in the evening” focused on the public television building. Gyurcsany resigned in 2009 after a no-confidence motion in Parliament, replaced by care-taker PM Gordon Bajnai, who stayed in the job less than a year.

The mood shift within those new EU Member States with a history under the thumb of the Soviet Union surprised those who have kept a distance, not those closer in. The fall of the Soviet Union was a hopeful moment in Eastern Europe. Western governments and NGOs were quick to send legions of free-market capitalism supporters. But, as more than one Eastern European observed, democracy was conflated with dreams of big houses, big vacations, big cars and Big Macs.

Foreign investment flowed into Eastern Europe. Average salaries tripled, though remaining attractively lower than in Western democracies. In a sense, however, nothing changed. Despite all the seminars on management and innovation - across all sectors – there would be no democratic “big bang” in Eastern Europe. These changes take generations, far longer than expectations, and as public expectations fell with poor fiscal and social decisions savvy politicians seized the opportunity to feed the anxious and frustrated public safety and security promises more often than not blaming “those people.”   

Foreign investors in Hungary have taken notice, slowly. One of several laws coming into effect is a retroactive tax on foreign investment. More than a dozen big companies communicated their displeasure in a letter (December 15) to European Commission (EC) President Jose Manuel Barroso asking him to “convince the Hungarian government of the importance of having stable legal conditions for investors" and force it to “withdraw its unfair taxes.”

The EC saw that law coming months ago; Commissioner Neelie Kroes sent the letter asking for clarification back in October. The letter from the big - largely German - companies was duly noted, said an EC spokesperson at a Brussels press conference (January 3). “As soon as we draw a conclusion from this, which is far from being the case, we will take a decision,” said Olivier Bailly, quoted by DPA. EC rules don’t allow governments to “tax some operators in a sector more than others.”

More than a year ago (November 2009), Orban, as leader Fidesz, made clear his intention to take back media outlets owned by foreign companies. License renewals of Austrian and American owned top rated radio stations were denied under a dubious tender process and, allegedly, with demands for “gratuities” from political operatives attracting international attention from the Financial Times and The Economist. Even after more questionable legal decisions over the case in Hungarian courts left the foreign investors to pursue their claims in international venues, the attitude within the Hungarian media sector was largely ambivalent.

With the new media law now in effect some Hungarian media are paying attention. “The freedom of the press in Hungary comes to an end,” declared daily newspaper Nepszabadsag on its front page (January 3) in every European language. Newspaper publishers have enjoyed a lack of scrutiny in the name of “press freedom” not afforded broadcasters, which must endure license renewals and content monitoring. “The media law only serves the Fidesz government's authoritarian interests,” said the accompanying editorial. Nepszabadsag is majority owned by Swiss publishing house Ringier and has ties to the Hungarian Socialist Party (MSZP).

“We must defend our democratic rights in Hungary! We demand the freedom of the press!” fronted another newspaper – Nepszava. “We hope Europe is aware of these undemocratic measures and will make its own prudent diplomatic decisions, even if the majority of Hungarians is unaware of any of this.” Nepszava is an independently owned center-left daily.

Justice Minister Tibor Navracsics, in Magyar Hírlap (January 3), called criticism of the media law “hysterics.” Critics don’t know the laws details, which, he said, complies “in all respects” with European legal standards. “They are a collection of unfounded, at times outright absurd accusations. The Hungarian government remains committed to freedom of the press, and in no way wishes to stifle the opposition's views.

“If there are really problems in practice, we will not hesitate to modify the law, which is in principle a good piece of work,” Minister Navracsics added in an apparently more nuanced position from that expressed by PM Orban after Parliament ratified the law and international criticism mounted. Media outlets have the right to challenge any assessment through the court system before paying up.

“This is a European law,” said PM Orban on Hir TV (December 24). “We will certainly not change it.”

Arriving with Hungary taking the rotating European Union presidency, the new media law, a law taxing private pensions and the law taxing foreign investment puts Hungary and Viktor Orban under the international microscope. He has long complained that Western Europeans treat Eastern Europe as second-class citizens, a view shared by more than a few Eastern European politicians and political observers. Provisions in the new Media Act, he said, can be found in the laws of other countries, mentioning Italy, France and the UK.

“Freedom of the press is at the heart of a free society,” said a statement from the UK Foreign and Commonwealth Office (FCO). “We hope that the Hungarian Government will soon resolve this issue satisfactorily and that it will not impact adversely on the successful delivery of the Hungarian EU Presidency.” The new UK Conservative Party government has demanded 25% cuts in BBC budgets as well as bringing the BBC and regulator OFCOM under direct political control.

See also in ftm Knowledge

Media Laws – New and Revised

Policy makers and politicians are writing and rewiting media laws and rules at a breakneck pace. As broadcasters and publishers grapple with changes brought about by digital development, new business models and financial distress, the new media is feeling rules tightening around it. From licensing and public broadcasting to privacy, piracy and copyright this ftm Knowledge file Media Laws – New and Revised summarizes new laws and revised laws from a media perspective. 135 pages PDF (December 2010)

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