Left wing analysts sceptical on financial outlook
November 12th, 2011Commenting on the EU’s decision to keep Hungary under its ‘excessive deficit procedure’, Népszabadság’s main business analyst fears that Hungary cannot avoid a debt-crisis. Another leading columnist in the number one left-wing daily believes that the government has still not given up its policy illusions.
Finance commissioner Oli Rehn told the press in Brussels that Hungary’s low public deficit is a result of temporary measures, and Budapest will therefore have to continue reporting on how its public finances approach the Maastricht criteria.
“The government should reconsider its economic policies, even at the price of contradicting its own campaign rhetoric,” – Ervin Tamás warns in Népszabadság. The word ‘reform’ has been discredited over the past two decades, remarks the veteran columnist, by politicians who have repeatedly used it to describe cyclical austerity measures, introduced after periods of irresponsible overspending. Now Hungary is at the end of the road, Tamás believes, and the government should immediately demolish certain taboos, even those which it has championed until now.
“If you’re on the wrong train, all the stations will be the wrong ones,” Tamás concludes. “Time to get off the wrong train.”
In another commentary on the same page, Népszabadság’s business analyst Miklós Blahó worries that Hungary cannot escape the looming debt-crisis, especially because of the absence of rationality in its economic policy. Blahó nonetheless also lists several measures which prove that the government has actually started to tackle some of those taboos mentioned by his colleague. More income is expected from a new electronic motorway toll scheme, while expenses will be cut through a simplified system of regional administration and of public education. Further savings are expected to result from the reorganization of public health care and community transport. Disability pensions will also be revised. Blahó remarks that the government has yet to provide Brussels with an estimate of how much it expects to save through these extremely unpopular measures. He describes next year’s restrictions, which amount to four per cent of GDP as “horrific”, and asks why the government has opted to buy MOL and Rába shares (See BudaPost, November 11), when it is so short of money.