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Utility tariff cuts as campaign tools

September 10th, 2013

Commenting on the government’s plan to transform the energy and utility providers into non-profit services, a left-wing and a centrist columnist accuse the government of welfare populism. A right-wing pundit, on the other hand, believes that the Socialists want to increase their popularity by creating a fully welfare dependent constituency.

On Saturday, Fidesz floor leader Antal Rogán hinted that the government was planning to transform the energy and utility sector into a non-profit industry. Earlier in the week, the government decided to impose another 11.5 per cent cut in utility tariffs (see BudaPost September 7).

In Népszabadság, Róbert Friss likens the non-profit plan to the welfare programs and nationalization prevalent in Hitler’s Germany and the past Communist regime in Hungary. The left-wing columnist believes that the Orbán government has not succeeded in boosting economic output, so its wants to increase its popularity before the 2014 election by increasing public spending – regardless of the long-term consequences of the complete overhaul of the energy sector. As a result of what amounts to the partial nationalization of the energy and utility providers, Hungary’s competitiveness will further decline, Friss concludes.

Following in the footsteps of the left-wing parties, Fidesz has learned by now that Hungarians want stability and security first and foremost, Bence Pintér writes in Mandiner. The centrist commentator points out that despite the government’s efforts the Hungarian economy is still in rather poor shape: GDP growth is sluggish and the public debt has not been reduced. As a result, the Orbán government has co-opted the strategy of the MSZP and is trying to connect to its base through the good old rhetoric of the Kádár regime, promising low prices and a strong welfare state, Pintér suggests. Such ‘phony welfare populism’ right across the political spectrum keeps an insane and irrational public culture alive according to which Hungarians can hope for a better life through active state intervention in the economy, Pintér contends.

In Magyar Nemzet, Dávid Megyeri finds it peculiar that the MSZP seems to hesitate about whether to support tariff cuts. Some Socialist politicians criticize the government’s steps by claiming that tariff cuts slow down economic growth, while others would promise even higher cuts in order to help Hungarian families to spend more, Megyeri maintains. The Socialists also like to criticize across-the-board tariff cuts and demand a need-based support program which, they claim, would favour poorer families, the pro-government columnist notes. Megyeri contends that by advocating targeted financial support for families which cannot pay their energy and utility bills, the Socialists want to make large cohorts of Hungarian voters dependent on welfare in the hope that they would then support the MSZP. Instead of this politically motivated welfarist approach, the Orbán government cuts prices as part of what Megyeri calls “economic restitution”. He believes that the energy and utility providers privatized under earlier Socialist-led governments imposed unrealistically high prices in the past and thus Hungarians legitimately expect to be compensated now through tariff cuts.

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