EU Cabalists Resort to Bullying & Tax Evasion

Here’s another sign that the EU has become more and more powerless each passing day.

Since the day Hungary decided to strengthen its ties with the more progressive BRICS, EU started applying pressure on their leaders through travel sanctions and similar dirty tactics.

Fortunately for Hungary, the Cabalist EU may have only a few months to  live.

Hungary Is Helping Putin Keep His Chokehold on Europe’s Energy

A key NATO ally is cozying up to the Russian dictator and trying to help him build a $70 billion pipeline to extend his reach into the heart of the EU.


Europe and the United States are trying to build a common front to push back against Russian aggression, and especially to pry the energy weapon out of Russian president Vladimir Putin’s hand. But one member of the team seems to be switching jerseys.

Hungary, under the leadership of Prime Minister Viktor Orban, has increasingly hewed to a more pro-Russian policy in recent months by doing huge deals with Moscow and criticizing Western sanctions on Russia, which is prompting angst from Brussels to the Beltway. The tilt toward Moscow is especially apparent when it comes to energy, which is itself at the root of European fear about what Russia has done in the past and could do again.

Hungary’s latest move was to authorize construction Monday of the South Stream pipeline, a pet project of Putin’s which is meant to offer an end-run around Ukraine for Russian natural gas exports headed for Europe. In the wake of the annexation of the Crimean peninsula and Russian armed disturbances in the eastern part of Ukraine, Europe slammed the brakes earlier this year on the $70 billion project. Europe is afraid the pipeline violates EU competition law and will only serve to increase reliance on Russian gas.

South Stream is meant to pump gas from Russia under the Black Sea through Bulgaria, Serbia, Slovenia, Hungary and eventually to Austria. The project is meant to provide another alternative pipeline from Russia to Europe while bypassing Ukraine.

This week, though, Hungary’s parliament rammed through legislation that overrides European objections and would pave the way for South Stream to start construction, involving energy firms such as Gazprom, Eni of Italy, EDF of France, and Wintershall of Germany.

Orban’s support for the project is especially noteworthy because he denounced the South Stream deal with Russia as tantamount to a “coup” against Hungary when he was still in the political opposition in 2008. Since then, though, he has taken to denouncing Europe and the West while championing “illiberal” states from Russia to China as role models for Hungary.

“Clearly there is a pro-Russian shift in Hungarian energy policy,” said David Koranyi, the deputy director of the Eurasia Center at the Atlantic Council and former Hungarian government adviser.

The support for South Stream brought a yelp of dismay from the European Union, which asked Hungary for clarification. U.S. diplomats have also been warning Budapest about the folly of continuing to rely on Russia for energy supplies. “Diversifying sources is what’s important,” said Andre Goodfriend, the top U.S. diplomat in Hungary late last month (the U.S. currently has no ambassador in Hungary).

“Orban increasingly believes that a closer energy relationship with Russia is a much better guarantee for Hungary’s energy security” than seeking security through a more robust European Union, Koranyi said. “It’s a major about face from the role that Hungary used to play. Hungary can be a major stumbling block in what the European Union wants to achieve” in terms of building a single gas market in Central Europe, he said.

When it comes to South Stream, some energy experts think Orban may genuinely see benefits for Hungary of shepherding gas to the West. Transit countries make money off the energy trade, and a new pipeline would remove legitimate fears of Ukraine’s reliability as an energy-transit country. In 2006 and 2009, when Russia cut off gas exports, Europe concluded that Ukraine had dipped into transit gas to meet its own needs, leaving millions to suffer downstream.

Others think that multi-billion dollar projects are appealing because they offer a way for Hungary’s political leaders to distribute money, largesse and cement political loyalty. Last month, the Obama administration slapped travel bans on six Hungarian government officials for alleged corruption.

Hungary itself has said it is in favor of European cooperation on the energy front, and Foreign Ministry officials have stressed the benefits that would come from closer trade ties with the United States, especially when it comes to energy.

But it has also defended South Stream as vital to Hungary’s own energy security–and hinted that, when push comes to shove, Europe won’t be able to come to Hungary’s rescue.

“Hungary will construct the South Stream gas pipeline because it will improve the security of our energy supply,” Orban said in July. “We do not want to find ourselves in a situation in which Hungary’s gas supply is dependent on what happens in Ukraine.”

“Those who are opposed to the South Stream today only want to take away our right to energy supply security, but without doing anything in exchange,” Orban continued.

But Hungary’s two-finger salute to Brussels on the pipeline isn’t an isolated incident. In September, just after a visit from Gazprom boss Alexei Miller, Hungary suddenly suspended its own shipments of natural gas to Ukraine, which had been without Russian gas since June and relies on European countries to supply it through the back door. Hungary also locked up additional gas supplies to top up its own dwindling reserves of fuel before winter.

This spring, Hungary put the final signatures on a $14 billion deal to buy nuclear reactors from Russia’s Rosatom — financed by Moscow — even as concerns abounded about Russia’s use of energy to hold European countries hostage to its whims.

And throughout, Hungary’s state-owned energy firm MOL has been in talks to sell its shares in a Croatian energy firm to Gazprom, brushing aside pleas by European and U.S. officials not to because of the key role that Croatia plays in southeastern European energy security. State Department officials asked Sen. Chris Murphy (D.-Conn.), the chairman of the European affairs subcommittee of the Senate Foreign Relations Committee, to bring up the issue on his recent European trip.

President Barack Obama and top U.S. diplomats have steadily amped up their criticism of Hungary, which is a member of NATO and has traditionally maintained close ties with the U.S.

During a September speech in New York, Obama lumped Hungary with Venezuela, Russia, and Egypt among countries that are stifling dissent and civil liberties at home. In October, Victoria Nuland, the State Department’s top official for Europe, blasted Hungary’s stance at a speech in Washington.

“Even as they reap the benefits of NATO and EU membership, we find leaders in the region who seem to have forgotten the values on which these institutions are based,” Nuland said. “How can you sleep under your NATO Article 5 blanket at night while pushing ‘illiberal democracy’ by day; whipping up nationalism; restricting free press; or demonizing civil society? I ask the same of those who shield crooked officials from prosecution; bypass parliament when convenient; or cut dirty deals that increase their countries’ dependence on one source of energy despite their stated policy of diversification,” she said.

Hungary bristled at the criticism, rejecting the notion that it has moved away from democracy. But other Europeans are worried they will be tarred with the same brush thanks to Orban’s lurch toward Moscow.

“The biggest threat I see is that we get a perception in Washington that the whole region is going in a weird direction, and that’s not true. Hungary is really an outlier,” one Central European diplomat told Foreign Policy.

Some energy experts see Hungary’s support for South Stream, in particular, as a reflection of Orban’s statist approach to economics. The European diplomat likened Orban’s economics to former Italian dictator Benito Mussolini’s corporate statism.

“Orban does not think in terms of markets or consumer choice; his administration thinks and acts in terms of state ownership and control,” said Andreas Goldthau, who studies the geopolitics of energy at Harvard University’s Belfer Center. “From that perspective it makes sense to close long term deals, put state-owned MOL in charge, and build the pipe,” he said.

At the same time, massive energy deals, especially with Russia, offer the lure of billions of dollars sloshing around an opaque political system.

“Corruption is, I believe, a defining factor in the decision of the prime minister and his inner circle to go that route” on the nuclear plants and the new pipeline, the Atlantic Council’s Koranyi said.

Since the Ukraine crisis exploded in earnest one year ago, it has become increasingly apparent that Russia is finding it difficult to use energy as a stick. It has proven tough, not to say impossible, to cow countries such as Ukraine, Poland, or the Baltic states just with threats of energy cutoffs or jacking up prices. Indeed, Russia’s heavy-handed approach has sparked a scramble across Eastern Europe to line up alternative sources, such as the first natural-gas import terminal in the Baltics, or the Polish prime minister’s grandiose plans for a European energy union.

But as Hungary’s evolution under Orban appears to show, for countries already leaning east, Russian energy can seem if not a stick, then most certainly a tasty carrot.

Yuri Kochetkov – AFP – Getty


The bullying of Hungary – the country that dared to disobey the US and EU

Neil Clark is a journalist, writer and broadcaster. His award winning blog can be found at / Karoly Arvai

25 years ago, Hungary was being toasted in the West for opening its border with Austria to East Germans, in a move which led to the fall of the Berlin Wall. Now the Western elites are not happy with Budapest which they consider far too independent.

The refusal of Prime Minister Viktor Orban and his ruling Fidesz party to join the new US and EU Cold War against Russia, which has seen the Hungarian parliament approving a law to build the South Stream gas pipeline without the approval of the European Union, in addition to the populist economic policies Fidesz has adopted against the largely foreign owned banks and energy companies, has been met with an angry response from Washington and Brussels.

Hungarian officials have been banned from entering the US, while the European Commission has demanded that the Hungarians explain their decision to go ahead with South Stream. That’s on top of the European Commission launching legal action against the Hungarian government for its law restricting the rights of foreigners to buy agricultural land.

The bullying of Hungary hasn’t made many headlines because it’s so-called “democrats” from the West who have been doing the bullying.

Viktor Orban is not a communist, he is a nationally-minded conservative who was an anti-communist activist in the late 1980s, but the attacks on him and his government demonstrate that it doesn’t matter what label you go under – if you don’t do exactly what Uncle Sam and the Euro-elite tell you to do – your country will come under great pressure to conform. And all of course in the name of “freedom” and “democracy.”

Fidesz has been upsetting some powerful people in the West ever since returning to power in 2010. The previous “Socialist”-led administration was hugely popular in the West because it did everything Washington and Brussels and the international banking set wanted. It imposed austerity on ordinary people, it privatized large sections of the economy, and it took out an unnecessary IMF loan. Ironically, the conservative-minded Fidesz party has proved to be much better socialists in power than the big-business and banker friendly “Socialists” they replaced.

One of the first things that Fidesz and its coalition allies, the Christian Democratic People’s Party, (KDNP) did was to introduce an $855m bank tax – the highest such tax in Europe – a measure which had the financial elite foaming at the mouth.

Orban clashed with the IMF too, with his government rejecting new loan terms in 2012, and paying off early a loan taken out by the previous government, to reduce interest payments.

Hungary's Prime Minister Viktor Orban (Reuters / Bernadett Szabo)

Hungary’s Prime Minister Viktor Orban (Reuters / Bernadett Szabo)

In 2013, Orban took on the foreign-owned energy giants with his government imposing cuts of over 20% on bills. Neoliberals expressed their outrage at such “interventionist” policies, but under Orban, the economy has improved. Although it’s true that many still look back nostalgically to the days of “goulash communism” in the 1970s and 80s when there were jobs for all and food on the table for everyone. Unemployment fell to 7.4 percent in the third-quarter of this year; it was around 11 percent when Fidesz took power, while real wages rose by 2.9 percent in the year up to July.

The man his enemies called the “Viktator,” has shown that he will pursue whatever economic policies he believes are in his country’s national interest, regardless of the opinions of the western elite who want the Hungarian economy to be geared to their needs.

His refusal to scrap his country’s bank tax is one example; the closer commercial links with Russia are another. Russia is Hungary’s third biggest trading partner and ties between the two countries have strengthened in the last couple of years, to the consternation of western Russophobes. In April, a deal was struck for Moscow to loan Hungary €10 billion to help upgrade its nuclear plant at Paks.

Orban’s policy of improving trade and business links with Russia, while staying a member of the EU and NATO, has however been put under increasing strain by the new hostile policy towards Moscow from Washington and Brussels.

Orban again, has annoyed the West by sticking up for Hungary’s own interests. In May he faced attack when he had the temerity to speak up for the rights of the 200,000 strong Hungarian community living in Ukraine.”Ukraine can neither be stable, nor democratic, if it does not give its minorities, including Hungarians, their due. That is dual citizenship, collective rights and autonomy.” Hungary’s Ambassador was summoned to the Foreign Ministry in Kiev. Donald Tusk, Prime Minister of Poland, the US’s most obedient lapdog in Eastern Europe, called Orban’s comments “unfortunate and disturbing” as if it was anything to do with him or his country.

In August, Orban accurately described the sanctions policy of the West towards Russia as like “shooting oneself in the foot.”“The EU should not only compensate producers somehow, be they Polish, Slovak, Hungarian or Greek, who now have to suffer losses, but the entire sanctions policy should be reconsidered,” Orban said.

In October, Hungarian Foreign Minister Peter Szijjarto also questioned the sanctions on Russia, revealing that his country is losing 50 million forints a day due to the policy.

Hungary has made its position clear, but for daring to question EU and US policy, and for its rapprochement with Moscow, the country has been punished.

It’s democratically elected civilian government which enjoys high levels of public support, has ludicrously – and obscenely – been likened to military governments which have massacred their opponents. “From Hungary to Egypt, endless regulations and overt intimidation increasingly target civil society,” declared US President Barack Obama in September.

Last month there was another salvo fired at Hungary – it was announced that the US had banned six unnamed Hungarian government officials from entering America, citing concerns over corruption- without the US providing any proof of the corruption.

RIA Novosti / Ramil Sitdikov

RIA Novosti / Ramil Sitdikov

“At a certain point, the situation, if it continues this way, will deteriorate to the extent where it is impossible to work together as an ally,” warned the Charge D’Affaires of the US Embassy in Budapest, Andre Goodfriend. The decision and the failure to provide any evidence, understandably caused outrage in Hungary. “The government of Hungary is somewhat baffled at the events that have unfolded because this is not the way friends deal with issues,” said Janos Lazar, Orban‘s chief of staff.

The timing of the ban has to be noted, coming after the Hungarian government had criticized the sanctions on Russia and just before the national Parliament was due to vote on the South Stream pipeline. The pipeline, which would allow gas to be transported from Russia via the Black Sea and the Balkans to south and central Europe without passing through Ukraine, is a project which Russophobes in the West want cancelled.

“I am inclined to think that it is a punishment for the fact that we talk to Russia,” said Gabor Stier, the head foreign policy editor of the leading Hungarian newspaper Magyar Nemzet.

“America thinks that we are corrupt, but we are a sovereign state, and it is our business. Many people in the United States do not like that Viktor Orban is very independent…..Corruption is just an excuse.”

It’s hard to disagree with Stier’s conclusions. Of course, there is corruption in Hungary, as there is in every country, but it pales in comparison with some countries who are faithful US allies and who Washington never criticizes. The 2013 Corruption Perceptions Index compiled by Transparency International, reveals that Latvia, the Czech Republic, Croatia, Romania, Bulgaria and Bosnia-Herzegovina are all below Hungary, as indeed is Italy. Yet it’s Hungarian officials that the US is banning.

True to form, the attacks on Orban and his government in the Western media have chimed with the political attacks. ‘Is Hungary, the EU’s only dictatorship?’ asked Bloomberg View in April. The BBC ran a hostile piece on Orban and Fidesz in October entitled Cracks Emerge in leading party, and which referred to “government corruption” and “the playboy lifestyle of numerous party officials.”

The piece looked forward to the end of Fidesz rule.

While earlier this week, the New York Times published an OpEd by Kati Marton, whose late husband Richard Holbrooke, was a leading US diplomat, entitled Hungary’s Authoritarian Descent. You’d never guess that the Hungarian government wasn’t the flavor of the month in the West would you?

Russian Foreign Minister Sergei Lavrov, left, and Hungarian Prime Minister Viktor Orban at their meeting in Budapest (RIA Novosti / Eduard Pesov)

Russian Foreign Minister Sergei Lavrov, left, and Hungarian Prime Minister Viktor Orban at their meeting in Budapest (RIA Novosti / Eduard Pesov)

The question which has to be asked is: will Hungary be the next country to be the target of a US/EU sponsored regime change?

We all know what happened to the last Viktor who refused to sever links with Russia. Will Orban suffer the same fate as Ukraine’s Yanukovich? There are good reasons for believing that he won’t.

Fidesz did make a mistake by announcing the introduction of a new internet tax last month, which brought thousands onto the streets to protest but they have since dropped the plans and the problem for the US and EU is that Orban and his government remain too popular. In October’s local elections Fidesz won 19 of Hungary’s 21 larger towns and cities, including the capital city Budapest, not bad for a party that‘s been in power since May 2010.

Orban’s brand of economic populism, combined with moderate nationalism, goes down well in a country where people remember just how awful things were when the neoliberal “Socialists” were in power. His style of leadership may be authoritarian, but Hungarians prefer having a leader who has cut fuel bills and reduced unemployment to one who mouths platitudes about “liberal democracy” but who imposed harsh austerity measures and leaves them unable to afford the daily essentials.

Moreover Hungary, is already a member of the EU and NATO unlike Ukraine under Yanukovich and isn’t about to leave either soon. On a recent visit to America Foreign Minister Peter Szijjarto told the US TODAY newspaper “US is our friend, US is our closest ally.” The US clearly wants more from Hungary than just words, but while both Washington and Brussels would like to see a more obedient government in Budapest, the “liberal” and faux-left parties they support simply don’t have enough popular support for the reasons outlined above. And things would be even worse for the West if the radical nationalist party Jobbik, the third largest party in Parliament, and which made gains in October’s local elections, came to power- or if there was a genuine socialist/communist revival in the country. The fact is that Orban is in a very strong position and he knows it. That’s why he feels able to face down the threats from abroad and maintain a level of independence even though total independence is impossible within the EU and NATO.

We can expect the attacks on Orban and his government to intensify but the more the West attacks, the more popular Orban, who is able to present himself as the defender of Hungary’s national interests, becomes.

Hungary gave the West everything it wanted in 1989, and, as I pointed out here, its “reform” communist leadership was richly rewarded. But in 2014 it’s a very different story. In the interests of democracy and small countries standing up to bullying by powerful elites, long may Hungary’s spirited defiance continue.

Hajra, magyarok! Hajra Magyarorszag!

source »

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