Well I don’t know if Kyiv is going to fall tomorrow, but it is obvious there is a lack of…
A Fantastic Novel in FIDESZ Style
Or why do the court media love riding on a dead horse so much?
The regime media are permanently reporting about the non-existent “case” of the sale of the Budapest city hall. A monumental building that perhaps does not really well fit the needs of a 21st century’s administration, but is definitely a sight of the city. The entire case is around a “contract” of a company, which is in liquidation since last summer, which would like to buy and a real estate agency. Former PM Gordon Bajnai was asked by an oligarch, what he thinks about such a sale, and Bajnai pointed out that the question should not be even asked in the political climate. Right he was.
A “leaked” (or produced) video claims that Zsolt Berki would be connected to Karácsony and would be the key figure behind the “sale.” Berki is well known in the city hall. During the Tarlós years (2010 – 2019) his transactions with the city of Budapest had a volume of 4.2 billion Forint (11.35 million Euro as today), since Karácsony has been elected in 2019 it was a volume of 160 million Forint (430 000 €) ►HU. Hard to declare that Karácsony would advantage Berki and we mustn’t forget 2 things: That such a sale is made public in all cases including the complete wording of the contract and that the highest bidder is the highest bidder. Not only in rigged procedures where only one bidder is possible as under FIDESZ, but also when everybody gets a chance to participate as these days in Budapest.
However, Berki declared that he knows neither Tarlós nor Karácsony in person. According to Zsolt Láng, chairman of the FIDESZ delegation in the Budapest council, Berki was invited by the city owned company BFVK, Budapest Főváros Vagyonkezelő Központ Zrt. (Budapest Capital City Asset Management Centre Ltd) concerning the sale of public owned properties, including the city hall. The lord mayor would know about and the sale would happen through a public tender. Berki declared in a letter published by telex ►HU end of December 2021 that these statements are completely invented, literally: “vile fabrications without any basis in reality”.
When the Völner scandal became public – what a “coincidence of events” – police did not raid the office of Völner, but of the city administration. Besides documents that are published on the city website also graphics shown journalists have been seized. Highly suspicious.
The administration of Budapest inventoried the possibilities what to do with the building complex in decline. 444 has a summery ►HU of the several plans and an original overview document. Earlier mentioned BFVK has made 6 plans, 2 of them included the sale of the city hall, these documents are dated on October 28th, 2020. On November 26, 2020, nearly a year before the “scandal” was published, the council voted for a plan that includes not to sell the city hall! Construction of a new city hall – and selling the old one – was not the option of the city administration, the council adopted a renovation plan and to turn most parking spots into green spaces, as demonstrated in this picture the council published ►HU.
A commentator here told a couple of days ago about the situation in the USA, that many public buildings, including city halls, were sold just to free the financial means bound in brick and mortar. Of course such a transaction is generally legal, not only in the USA, but in Hungary as well. Budapest as well sells real estate, a lot of closed contracts can be found on their website ►HU. Right now unused estates, among them even abandoned castles near Lake Balaton are offered for sale, something the former city administration tried as well – and found no buyer ►HU. Of course it makes sense in many cases, why should the city own real estate they don’t need? Whether a leaseback construction for the city hall would be a good set is another question, very much depending on prices and conditions. Economically in today’s situation not so much I expect, but in opposite to a company Budapest is not allowed to borrow at own discernment, this right has been very much limited by the Orbán regime. So a sale be the only solution to get cash out of its real estate. The biggest obstacle would be the fact that the city hall is listened as monument and that gives the central government the right to stop the sale. And still a sale where another authority needs to give permission for is definitely not illegal. So the entire scandal is about the question whether under lord mayor Karácsony was taken a legal decision – or not.
So what is the big issue with a sale of the city hall? It is not about legal questions, but about the mentality of voters. Hungary is a country of homeowners. Rural citizens always owned their own houses, those living in the cities for the greatest part have had the chance to buy their rented flats or houses for a very low price, just because the former owners, mostly the local governments, had no money to maintain them. This was the real estate privatisation wave during the 1990s. Over all Hungary more than 90 % live in own homes, in rural FIDESZ land it tends to be 100 %. Young people moving out of the house of the parents need to buy, just because this is the way how you get a house, apartment, whatever. And in such a world of experience the sale of the city hall is an absolute no go. It is a story of “the left will sell everything, even the home of the city.” So stupid and so easy.
And why do the court media love riding on a dead horse? Because they don’t have one that is alive! The regime did a lot of efforts to create a case against Karácsony, when he was thought to become the candidate of the united opposition. It took time to get all these people involved, including the failed attempt to get involved a former “left” PM. Not that the case was good, but at least something one can tell horror stories about. And as everybody Orbán was surprised as well when Péter Márki-Zay became the united opposition’s candidate. A candidate the regime did not think about, so they did not think about creating a story against him. Against Klára Dobrev they had at least a scary movie people didn’t want to watch, but against Márki-Zay? As long as the regime media have nothing to report about Márki-Zay the dead horse will be ridden again and again and again. And the “scandal” has since January a 2nd victim, a journalist at index. Balázs Gabay, who last November brought the “news” of the city hall being for sale, gave up his job. He declared the pressure from the government became too much to bear for him ►HU. The 1st victim of course was the truth.
Voila, the “Council of Judges” (OBT) has already submitted to Orban's "reorganization" by the afternoon. https://obt-jud.hu/sites/default/files/ulesek/Osszefoglalo_2024.11.20.pdf
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I thought your comment on the importance of property ownership mentality in Hungary, coming out of communism, was insightful. I wish I had more time to look at the fiscal condition of Budapest and understand it better. Eva did some posts on Fidesz’s strangulation of municipal fiscal support, so I know the situation is difficult in the context of limited taxation powers of those entities.
In general I am personally opposed to much of the privatization of public property I am seeing in the USA, which is interesting since I have been a conservative Republican most of my life. I began to become more and more suspect of it while in the US Army. The entire food service was privatized (with the exception of combat field kitchens) while I was still in the military, based on a claim of horrible food being provided to soldiers by US Army trained cooks and incredible waste of money. Over time the cost of bringing in private companies to do all this work increased due to the need for the providing companies to make a profit. It is now very questionable if any money is being faced now at all by these changes and its very clear that the corporate cooks are not soldiers who can perform combat duty when needed.
The finances of the Hungarian municipalities are in one word: Difficult. They are very limited in financing themselves through loans. In short they mustn’t take a loan for their legal functioning and the connected costs. So Budapest may sell the city hall, but mustn’t take a mortgage on it. If renting out dwellings (allowed, but no legal obligation to do so) they may finance these dwellings. Tax income are the property and / or inhabitant tax. Small amounts, a house serving as residence of the owner mustn’t be taxed higher than about 60 US$ a year. I myself pay about 23 US$ a year, a flat rate for every inhabitant of my village. The car taxes used to be split between central and local government. As “covid measure” Orbán took it completely away from the local governments. Most important tax is the business tax, which is paid by every company where the business takes place, which can be besides a store a market stand or a construction site for example, which is not necessarily in the same place as the company’s seat. Éva covered the case of the opposition governed Göd and the Samsung factory there. Orbán created a special zone to take the business tax away from Göd and handed it over to the FIDESZ ruled county of Pest. But not enough: Orbán invented another “covid measure” and cut the business tax in half. Companies pay less and the council mustn’t raise the tax either. To compensate Orbán gives with full hands financial help to municipalities – provided they have chosen the “right” mayor.
What concerns privatisation I wouldn’t say no generally. The run down castles Budapest wants to sell I regard as good sets. This is useless property, they are causing costs and don’t bring neither profit nor any other benefit. Public services tend to be ineffective and expensive privatisation might be an option to cut costs indeed. Since the private garbage collection has been nationalised they are providing a way worse service at effectively higher costs (regardless their statement on the bill how much I saved since nationalisation.) Fun effect: They abolished the central containers for glass collection. But I must neither use my recyclable container, nor the waste containers. So in theory I need to keep glass at home. But in the yearly bill is declared that glass is recycled for free…. As 3rd case selling a city hall to lease it back, just because the town needs the money is at least questionable. Pure economically spoken the purchaser will get from the council the interest he pays plus some profit. Every bank would do that cheaper, at least if it would be allowed.
“dead horses” if it’s a dead horse, it’s also good for the opposition, isn’t it? The difficulty lies in recognizing that the “dead horse” doesn’t exist at all. Supposedly, there is Dakota Indian wisdom “If you discover you are riding a dead horse, get off.” Now the only thing missing is discovering …
… on the other hand, Fidesz seems to be running out of ammunition. I can’t imagine anything worse than the “sale” of a City Hall.
FIDESZ is in lack of both wisdom and ammunition.
The Orban mafia also raided the municipality and state property, ie. selling hundreds of properties to themselves and cronies at prices varying from 60% down to 20% of the market value. Peter Juhasz investigated and listed over 95 properties sold this way in the 5th district of Budapest alone under mayor Antal Rogan.
The residential stock in the prestigious Castle Hill area was also targeted, but due to the long existing restrictions on sales the Orban robbers did it in a two stages, first they rented (at 30-50% of the market rents) and then the “tenants” were given the right to buy, at equally low prices.
Finally when Fid lost the local gov elections and these practices were stopped and the inherited cases were put under review, Orban quickly passed a law binding the loc. council to sell its properties at ridiculous conditions/prices.
Compare the above billions of HUF in effective damages to the public domain with the trumped up case of Sukoro, where a planned exchange (that never materialized) of properties between the state and an Israeli private developer were deemed by the Orban’s Chief Prosecutor to be unfair and damaging to the state and who tried for 8 to implicate former PM Gyurcsany in this charade of a case.