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This is off-topic but not completely, due to the contrasting parallels and far-right angles. In his latest op-ed in The Independent Johann Hari writes about the sole European example of standing up to the IMF:

Johann Hari: It's not just Dominique Strauss-Kahn. The IMF itself should be on trial - Johann Hari, Commentators - The Independent

Some people claim that Strauss-Kahn was a "reformer" who changed the IMF after he took over in 2009. Certainly, there was a shift in rhetoric - but detailed study by Dr Daniela Gabor of the University of the West of England has shown that the substance is business-as-usual.

Look, for example, at Hungary. After the 2008 crash, the IMF lauded them for keeping to their original deficit target by slashing public services. The horrified Hungarian people responded by kicking the government out, and choosing a party that promised to make the banks pay for the crisis they had created. They introduced a 0.7 per cent levy on the banks (four times higher than anywhere else). The IMF went crazy. They said this was "highly distortive" for banking activity - unlike the bailouts, of course - and shrieked that it would cause the banks to flee from the country. The IMF shut down their entire Hungary programme to intimidate them.

But the collapse predicted by the IMF didn't happen. Hungary kept on pursuing sensible moderate measures, instead of punishing the population. They imposed taxes on the hugely profitable sectors of retail, energy and telecoms, and took funds from private pensions to pay the deficit. The IMF shrieked at every step, and demanded cuts for ordinary Hungarians instead...

This is a fair description of the IMF's role, and the bank levy and the extra taxes were correct from my view. What's more, the government also pushed for a re-nationalisation of health insurance, using leftist rhetoric including the point that people's savings are used in casino capitalism. However, it is dangerous for European leftists to make this government an example to follow, and assume that the current situation will hold in the future. Unlike Michas's delusions for rich right-wingers, this will backfire on them.

Hungary's "economic freedom fighter" government [so said the economy minister] is not leftist and not consistent. Their rebellion against the Washington Consensus came about as a consequence of their earlier social propaganda from opposition, but their real economic views are a libertarian mess.

  1. The punitive measures on foreign capital (some of it political: there was also a buyout of the shares of a Russian gas company) were combined with the introduction of flat income tax and
  2. a(n illusory) hope to attract – yes – more foreign capital.
  3. The healthcare re-nationalisation drive is heavy on punitive measures against the insured, rather than bold enough to go for the throat of the companies themselves.
  4. The mad new constitution also includes a balanced budget requirement.
  5. To achieve that, the government reportedly prepared its own IMF-independent austerity package (which shall not be called austerity package but one Orwellian term or another), to be rolled out in full after the end of Hungary's EU Presidency.
  6. Already earlier this year, they began with massive cutbacks in culture, education, and some public servants, and some labour rights.

So, what will happen when they implement wider austerity? IMHO the key is the behaviour of the far-right, and it could get worse than in Greece. In Hungary, the fact that attempted 'centrist' instrumentation of the far-right only empowered the latter is reflected by an electoral result rather than just opinion polls changed the configuration.

Years ago, the now ruling Fidesz party wanted to gobble up the entire Right, from national liberal to the anti-semitic far-right. The now-strong Jobbik party escaped from that clutch, but others who think similarly remained, thus even while Jobbik began to act as a rival and kept challenging their government authority, Fidesz continued to refuse confrontation with Jobbik for fear of losing voters to them. Even when Jobbik-close paramilitias marched up and camped in in a village with many Gypsies, their first reaction was to attack 'leftist provocateurs' trying to sow mayhem and bring the country into disrepute. But in the end they saw no way around it and pushed through some new (and limited) anti-paramilitary laws.

So confrontation between Fidesz and Jobbik is on. And signs are Jobbik won't be content with focusing public anger on Gypsies and Jews, and will use social anger to attack the government, too. Right now, of the half dozen uncoordinated movements staging anti-government protests, the loudest is a police union associated with Jobbik. (The residential area around the PM's house was just cordoned off to keep them away.) All the while the 'Socialists' (and the media intellectuals who remain as representatives of liberalism) focus their criticism on... agreeing with the IMF criticism and the moaning of foreign multinationals, and LMP (the local Greens) are too obsessed with civility.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Sat Jun 4th, 2011 at 06:36:20 AM EST
Not at all off-topic. Fully relevant.

In Greece we had one Tea Party (the far-right LAOS) until last month. Now we have two (the more mainstream conservative New Democracy). They both stand around the slogan "Down with taxes" which unites the tax-evading classes: small business, professionals, corporations.
Hungary is the EPP Plan for Greece. It is already working and I think is rather unstoppable. The Socialists fell in this deadly trap.

 

"Eurozone leaders have turned a 50bn Greek solvency problem into a 1,000bn existential crisis for the European Union." David Miliband

by Kostis Papadimitriou on Mon Jun 6th, 2011 at 03:44:02 PM EST
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