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The rise of Fidesz and PiS

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May 2019

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Commemoration of victims of plane crash near Smolensk. 11.04.2010. On 10/04/2010 Polish President and the elite of the country died in a plane crash near Smolensk. CC BY-NC-ND 2.0, Michał Tajchert

“How to weaken a democracy: Hungary as European Avant-Garde” is the title of a recent essay by Slovak gender studies academic and editor Zuzana Kepplová (2019). The Fidesz government has indeed become a major role model for many European right-wing nationalist parties, not only in countries in the east of the continent but also in the West – much more so than Poland’s Law and Justice Party (PiS) government. At first glance, this seems surprising. Poland has more clout in the EU than Hungary, and PiS relies on the support of a broader conservative intellectual field than Fidesz. The following article looks at the fundamental contours of Fidesz and PiS’s projects to remodel the state, and their economic and social policies, situating them within the broader coordinates of the neoliberal and national-conservative streams of right-wing populism. From this, conclusions can be drawn as to why it is Fidesz, more so than PiS, that is considered the avant-garde of European nationalism.

The Long Rise of Fidesz and PiS

Fidesz was founded in the late 1980s by young liberal politicians as an anti-Communist party. In Hungary’s first multi-party elections in 1990, the party failed to succeed to the extent its founders had hoped for. Leader Viktor Orbán recognized that the party could reach a broader constituency by strengthening its conservative profile, and accordingly introduced a change of course in the mid-1990s. These efforts were rewarded as early as 1998, when Fidesz first took government in Hungary. Its policies were economically neoliberal, socially and culturally conservative, and marked by a strikingly nationalist rhetoric. Fidesz failed to win re-election in 2002, which was a surprise for the party leadership. The party then systematically strengthened its mobilization capacities and took an aggressive course in opposition. The back-flipping of the social-liberal government, which won office on the back of social-welfare promises but then opted for austerity in 2006, and its resulting loss of credibility as well as the harsh impacts of the 2008 financial crisis and the austerity programme that the social-liberal government agreed to with the International Monetary Fund and the EU in autumn 2008, all paved the way for Fidesz’s triumphant electoral victory in 2010. Fidesz won 53 percent of the vote and—due to peculiarities in the country’s voting system—a two-thirds majority of seats.

PiS emerged at the end of a number of metamorphoses in the national-conservative stream of the Polish right wing. Highly atypical among European nationalist movements, Polish national-conservatism and PiS maintain close ties to parts of the trade union movement such as Solidarność. The intellectual precursors to Polish national-conservatism, such as Zdzisław Krasnodębski (2003), concluded quite early on that the absence of social security was leading to increasing discontent in East Central European countries. In this they differ from other conservative intellectuals in the region. Yet the economic policies of the first PiS-led coalition government (2005–2007) were of a neoliberal stripe. Its attempts at state reconstruction were more aggressive than the first Fidesz government. In the wake of the 2008 crisis, PiS aggressively focused on social issues to the point of securing a virtual monopoly on them. With its conservative-social emphasis, PiS attempted to profit from discontent over the negative effects of the Polish economic model: precarious working conditions, low wages, and significant regional imbalances. With less than 40 percent of the vote and a slim absolute majority of seats, their 2015 electoral win was much less triumphant than Fidesz’s in 2010.

National-Conservative Remodelling of the State

In their second terms in government—and so after the global financial crisis—, Fidesz and PiS were more offensive in reconstructing state and economic infrastructure than they had been in their first terms before the crisis. The crisis lent increased credibility to their reconstruction plans, while at the same time leaving them with more room to move internationally. With their national-conservative conception of the state, they understood their electoral victories to constitute an all-encompassing “national” mandate, legitimating the elimination of institutional barriers to reconstruction such as an independent judiciary. An early electoral slogan of Orbán ran: “Small victory, small changes; big victory, big changes!” (cited in Lánczi 2018: 23). Winning a two-thirds parliamentary majority in 2010 enabled Fidesz to tailor itself a new constitution. It elevated a conservative historical narrative to constitutional status, and thanks to the restructuring of state institutions gave Fidesz a firm grip on all centres of state decision-making. The PiS did not enjoy such latitude when it came to reconstructing the state.

Fidesz and PiS’s projects of remodelling the state are centred around the party. Neither is a mass party, but both are characterized by a well-organized hierarchy of cadres. The advance of their respective “national” programmes is guaranteed by the fact that party members occupy key positions not only in ministries but also in the judiciary, regulatory bodies, public broadcasting and state-owned enterprises. To this extent, Fidesz and PiS distance themselves from a neoliberal, technocratic conception of politics, pursuing a course of repoliticization from the right.

Fidesz and PiS have both taken systematic steps to alter the composition of the supreme courts and gain decisive influence over the appointment of judges more generally. This amounts to a rollback of the hitherto strongly developed autonomy of the judiciary and a significant weakening of the division of powers. Attacks on the judiciary have led to fierce protests in both countries and also sparked conflicts at the EU level.

Fidesz and PiS have actively sought to bring the media under their control. They have brought public broadcasters into line with government in a far stricter way than their predecessors. In addition, Fidesz introduced licensing for electronic media so that it could palm channels off to its associates. Businesspeople close to Fidesz have received wide-ranging support—such as contracts for advertising campaigns and credit—to set up media empires aligned with the party’s interests. At the end of 2018, 476 Fidesz-aligned media companies were merged into a single holding company, the Central European Press and Media Foundation. Outside of the major cities, Fidesz-aligned media practically have a monopoly. The remaining independent media outlets are predominantly high-quality media aimed at an educated readership. PiS has also made systematic use of advertising contracts. An offensive aimed at taking over local newspapers was announced as the “repolonization” of the media, but was never implemented. The Polish media landscape is more diverse than the Hungarian. Fidesz and PiS have also sought to assert their cultural and historical vision through a policy of systematically occupying cultural institutions, and also in part by altering funding bodies. In Hungary, research institutes and universities are also under pressure. The case of the Central European University, which was prevented from being able to continue offering its Hungarian-American degrees, drew particular international attention. Far less international attention was paid to the attacks on the Hungarian Academy of Sciences, which is being stripped of the right to allocate its own resources. In both cases the Hungarian government explicitly targeted the social sciences. Using administrative means within the academy, the Hungarian government is being particularly explicit in its attempt to implement its reactionary models of history and gender relations, both of which are ideological cornerstones for Fidesz.

Through funding policies, both governments seek to selectively support the “nationalist” NGOs they deem palatable. The Hungarian government has also passed a series of restrictive regulations according to which NGOs that receive more than 23,400 euro from abroad (excepting EU funds) must be registered, and must declare their foreign financing on their websites and in their publications. In 2018 the Hungarian parliament passed a law criminalizing specific activities related to the support of refugees.

The Hungarian and Polish governments both seek to limit the legitimate political sphere to “national” actors. By restructuring state institutions they are able to occupy key state positions with loyal cadres, marginalize opposition forces, and weaken the division of powers. The authoritarian reconstruction of the state and the creation of a one-party state is much further advanced in Hungary than it is in Poland, where the opposition is stronger and the ruling party itself is also more diverse. The Hungarian government has also changed the country’s electoral laws to its own benefit. It has supplemented its policy of administrative micro-management with an aggressive campaign waged primarily against refugees, but also against liberal investor George Soros and his foundations, the latter of which is laced with anti-Semitic undertones. The stigmatization of minorities and the creation of “enemy” stereotypes—liberals, sexual minorities, refugees, and migrants—lies at the heart of Fidesz’s aggressive campaign strategy. PiS’s enemy stereotypes are similar, but it adopts a conservative style and unlike Fidesz attempts to broaden its constituency by adopting more inclusive social policies.

While Fidesz exhibits more markedly authoritarian features than PiS, the EU began putting pressure on Poland first. In 2017, the European Commission triggered Article 7 proceedings against Poland due to its justice reforms. As a member of the European People’s Party Fidesz long enjoyed its protection. But as the situation intensified in various ways in 2018 this protection began to come apart, such that in September 2018 the European Parliament recommended triggering Article 7 proceedings against Hungary. Fidesz’s membership of the European People’s Party was suspended in spring 2019. These primarily symbolic steps indicate how far these two formerly mainstream parties have distanced themselves from mainstream liberal-conservative conceptions of the state.

Selective Economic Nationalism

In the wake of the 2008 financial crisis new emphases in the economic orientation of both Fidesz and PiS began to emerge. These consist on the one hand of a more sharply defined “selective economic nationalism” (Tóth 2014) and on the other heterodox economic elements. For both governments, selective economic nationalism consists of targeted support of domestic capital. Yet this takes a different form in each case. Fidesz has cosseted businesspeople already close to the party. In their ascent these people are extremely dependent on government subsidies in the form of tenders, licenses, and credit from public banks. Hungarian sociologist Erzsébet Szalai describes this faction of capital as a “clientele bourgeoisie” (2018: 57). A case in point is Lörinc Mészáros, who within a few years rose from being an ordinary plumber in Orbán’s home town of Felcsút to become one of Hungary’s richest businesspeople. In 2017 alone, he won a tender worth around one billion euro (Eick 2018: 213). Public contracts are substantially co-financed by the EU. Support for domestic capital by Fidesz is limited to the banking sector and selected service sectors, that is, to the parts of the economy oriented towards the domestic market. With export-oriented industries, Fidesz, like its predecessors, relies heavily on foreign capital to which it offers substantial investment incentives. Since the crisis, the Hungarian economic model has been more exclusively oriented toward state-dependent industrialization than it was before the crisis. Before the crisis, growth had also been driven by rapidly rising household debt, approximately two-thirds of which was in foreign currency. And the devaluation of the forint during the crisis caused huge problems for the indebted middle classes. This debt model could not be continued afterwards. Despite resistance from the banks, Fidesz enforced the gradual conversion of foreign credit into forints. This was an important and heterodox economic move. It defused the middle-class debt problems and gave Fidesz some latitude regarding monetary policy.

In terms of fiscal policy, Fidesz combined a small number of heterodox measures—primarily sector-based taxation—with an extremely neoliberal income and company tax policy. It introduced a highly regressive flat income tax and radically lowered company tax. With this, Fidesz radicalized tax competition within an economic model of dependencies and peripheries. An orientation that benefits specific groups of capital and the upper middle class can be clearly discerned in Fidesz’s economic policy.

The Polish government also provides support to domestic capital, yet its policy is less clientelist than Hungary’s. It attempts to strengthen domestic capital not only in service sectors but also in industry. Particular significance is granted to the banking sector, where like Fidesz it has effectively strengthened the role played by domestic capital (Becker 2018: 425f). The banking sector, which was much less affected by the financial crisis than in Hungary, is supposed to support the restructuring of the Polish economy towards new, technologically advanced industries. PiS is also striving to structure the Polish economy in a more regionally balanced way (cf. Ministerstwo Rozwoju 2016). To this extent, PiS’s approach is characterized by a policy of proactive development. But in practice, this has not thrived. The Polish state lacks development capacities in both planning and implementation. Due to the large national market, domestic economic stimuli are of greater significance for the Polish government than for other East Central European nations. The Polish government pursues nothing akin to Fidesz’s aggressive tax competition policy. Yet it has—contrary to earlier announcements—also not seriously set about reforming its regressive tax system. The state’s relatively low revenues set limits to development and social-welfare initiatives.

Unlike Fidesz, PiS  has tended to call existing structures of dependence into question. It is also more consistently focused on maintaining the national currency and the economic flexibility this affords. The national-conservative elements of PiS’s economic policy are more pronounced than in Fidesz’s, which combines strict neoliberalism with a few national-conservative elements.

Different Routes Regarding Industrial Relations and Trade Union Policy

Fidesz has systematically weakened the trade unions’ institutional position by restructuring tripartite representative bodies and collective bargaining arrangements. The flexibilization of employment has weakened the position of dependent employees. In late 2018, Fidesz expedited a dramatic increase in overtime limits—from 250 to 400 hours annually—while refusing to allow trade unions to intervene. This led to increased trade union and political protests. Fidesz’s industrial relations policy is marked by an orientation toward the interests of export capital and a low-wage economy. However in early 2019, there were a few successful workers’ struggles in the export industries, such as at the Audi plant in Győr.

PiS has an ambivalent relationship with trade unions; its links with Solidarność, one of the country’s major trade union councils, are particularly close. A few industrial and social-welfare demands made by the trade unions have been implemented by the party. PiS also recreated the tripartite consultation bodies between government, business, and the unions, although it is selective in its dealings with them. Industrial law was amended after wide-ranging consultations. Employment contracts, rather than fixed-term service contracts, were even legally declared to be the rule, although with many exceptions. A few discreet steps toward rolling back or at least minimally regulating precarious working conditions were also taken by PiS.

In Hungary as in Poland, a central site of open industrial action was the public service, particularly the under-funded and poorly paid public health and education systems, with their high levels of female employees. Both governments proved to be harsh in these conflicts, as they had no intentions of making substantial changes to their policy of low taxation, which depends on keeping funding for public health and education low.

… And in Social Policy

In 2012 Hungarian Prime Minister Viktor Orbán outlined the social-political philosophy of his party: “rather than a Western kind of welfare state that is uncompetitive”, his party, he claimed, would establish “a work-based society” (cited in Szikra 2018: 5). According to this, and in line with the neoliberal social-political formula, Fidesz reduced the maximum period of entitlement for unemployment benefits from nine to three months, the shortest in the EU. Receipt of social benefits was made dependent on participation in public employment programmes. At the same time, the remuneration in public employment programmes was reduced to just 60 percent of the minimum wage. In poorer regions, forcing people into public employment programmes has been instrumental in the creation of clientelist networks (Breitegger 2018: 18). Fidesz’s attacks on disadvantaged sectors of the population was made glaringly clear in its policy of criminalizing homeless people found in public spaces.

Regarding retirement payments, Fidesz drastically curtailed early retirement pensions, and at the same time—mainly for budgetary reasons—abolished the private pillar of its pension fund system.

Only one area of social policy has been expanded by Fidesz: family policy, which is aimed at the restoration of traditional gender roles. Fidesz’s family policy is tailored to married couples and to families with stable employment and income, that is, to members of Orbán’s “work-based society”. A portion of services offered are explicitly bound to these criteria. Excluded from this are most notably Roma families, among whom unemployment is high. Family policy in Hungary constitutes a form of “welfare for the wealthy”, as Dorottya Szikra (2018) has put it. As a result, Fidesz’s social policy consists of neoliberal elements that stigmatize and penalize poor sectors of the population, and national-conservative elements that aim to restore traditional gender relations. It has a clearly exclusionary character.

A conservative family policy also forms the centrepiece of PiS’s social policy. But it takes a different shape to Fidesz’s. From the second child onwards—and according to PiS announcements, soon from the first child—families receive a monthly allowance of 500 złoty per child, regardless of income level and employment situation. This regulation is far less socially regressive than Fidesz’s policies. It is primarily attractive to low-income recipients in the countryside, and has contributed to a reduction in child poverty. A further core element of the PiS’s social policy is state funding of the (private) construction of rental apartments, which is designed to ease the severe shortage of affordable housing. To date only the rudiments of the programme have been implemented.

PiS took up the unions’ demand to undo the previous government’s increasing of the pension age. It has now been returned to 65 for men and 60 for women. Yet the government has decided on the creation of so-called employee lump-sum plans (PPK), a neoliberal partial reform of the pension insurance system. Overall, national-conservative elements dominate PiS’s social policy.

PiS’s social policy is more socially inclusive than Fidesz’s. It testifies to PiS’s desire to incorporate workers and poorer people in rural areas into its supported social cohort. Major structural deficits in education and public health are of no concern to either government.

Opposition and Protest

The relative strength of Fidesz and PiS is also partly due to the weakness of the respective political opposition in each case. This is particularly true in Hungary. The social-liberal opposition suffered a sharp loss of legitimacy due to its neoliberal austerity policies and scandals. The political opposition in Hungary is also polarized into a social-liberal and in part Green faction along with the far-right Jobbik party, which has however toned down its rhetoric in recent years. Jobbik is the strongest and most organized opposition group. The polarization of the opposition strengthens Fidesz. In Poland, the opposition parties are stronger. The former ruling party and now largest opposition party, the neoliberal Platforma Obywatelska (Civic Platform, PO), has not done anything to change the factors that led to it losing government, such as a lack of concern for social issues and their perceived aloofness from the electorate. Rather it has created a broad neoliberal coalition for the 2019 European Parliament elections, consisting of PO, the neoliberal Nowoczesna (Modern) and Agrarian parties, as well as the Sojusz Lewicy Demokraticznej (Democratic Left Alliance, SLD), which considers itself social-democratic. Beyond this coalition are the newly-founded left-liberal Wiosna (Spring) party, and an explicitly left-wing coalition around Razem (Together), which may well reach the five percent threshold for entering parliament. To the right of PiS there is a list of extreme right-wing groups, which predominantly find appeal among young voters. A loss for PiS in the upcoming (2019) Polish parliamentary elections cannot be ruled out. But in the long run, the fact that the main axis of conflict is between national-conservative groups—who save for Razem have a monopoly on social issues—and neoliberal ones is a constellation highly favourable to PiS.

Social protests have been predominantly in response to the dismantling of the rule of law and the restructuring of the mass media, and have been concentrated in the major cities. A particularly widespread protest led by feminist groups was provoked by PiS’s plans to further tighten the country’s already very strict abortion laws. The movement even resonated in PiS heartlands, forcing the party to back down. There have also been trade union protests against inadequate funding and low wages, primarily in the education and public health sectors. An unusually broad protest front of trade unions and groups from across the whole, heterogeneous opposition spectrum formed against the Hungarian government’s legislation on working hours. Protests have otherwise largely remained limited to political factions.

Fidesz’s Hungary as Right-Wing Model

The neoliberal and authoritarian elements of Fidesz are markedly more pronounced than those of PiS. Fidesz’s policies are clearly directed toward a core sector of the bourgeoisie and middle classes, into which parts of the working class are also peripherally integrated. Fidesz’s politics are clearly exclusionary, and it has a clear class project. Yet Fidesz seeks to reach voters across class boundaries through an aggressive strategy of mobilization, mainly against refugees and migrants, but also more generally against all non-national forces, sexual minorities, and liberal and left intellectuals. In its denunciations of non-national forces and specific refugee groups, as well as in its project of state remodelling and its family policy oriented toward the restoration of traditional gender roles, PiS is in agreement with Fidesz. But socially, the PiS project addresses a broader electorate and is more inclusive than that of Fidesz.

In its more neoliberal orientation and its extremely hostile campaigns against refugees and migrants, Fidesz is more closely aligned to the economically and socially strongly neoliberal hard nationalist right in Western Europe than PiS is (see the overview provided by Becker et al. 2018). This may well be the decisive reason why it is primarily the Orbán Government and not PiS that is considered to be a role model for the right-wing avant-garde throughout Europe.    

Joachim Becker is the Deputy Head of the Institute for International Economics and Development at the Vienna University of Economics and Business. This article originally appeared in LuXemburg – Gesellschaftsanalyse und linke Praxis. Translation by Marty Hiatt and Joel Scott.


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