NYT : Hungarian Leader Defies Calls to Resign

Hungarian Leader Defies Calls to Resign

By JUDY DEMPSEY | International Herald Tribune | September 19, 2006

BUDAPEST, Sept. 19 — Prime Minister Ferenc Gyurcsany refused to resign today after his admission that he had lied about the economy to win election in April set off Hungary’s worst anti-government violence in 50 years.

“The job of the institutions of the republic is now to strengthen people’s faith that calm can be restored,” Mr. Gyurcsany said at a news conference. “I am staying and I am doing my job.”

The riots Monday night, which left about 150 injured, raged into this morning outside the Hungarian state television building in central Budapest. They were the worst protests since 1956, when Soviet tanks crushed a popular uprising against the Communist regime. Tonight, thousands of people held a peaceful demonstration near the Hungarian Parliament.

The riots and protests exposed the fragility of the transition from totalitarian rule to democracy in Hungary and the rest of the region since the collapse of communism in 1989. Over the past year, national conservative and populist governments supporting slower reforms have been elected in Poland and Slovakia.

Mr. Gyurcsany, elected in 2004 as leader of the Socialist Party — the successor to the Communist Party — could face a populist backlash.

Although the Socialist Party has so far issued no public apology, President Laszlo Solyom said the country was “in moral crisis.”

Tibor Nacracsics, parliamentary leader of the conservative Fidesz opposition, said that there was “a moral crisis unfolding” and that “Ferenc Gyurcsany should make it clear that his comments referred to their period in government.”

Ibolya David, leader of the small conservative Hungarian Democratic Forum, told state television MTV that “the prime minister should abandon public life.”

Mr. Gyurcsany showed no signs of yielding. “I’m extremely committed to fulfilling my program, fiscal adjustments and reforms,” he said. “I know it’s very difficult for the people, but it’s the only decision for Hungary.”

The rioting broke out late Monday night at Budapest’s Szabadsag Square, or Freedom Square, as demonstrators demanded that Mr. Gyurcsany resign immediately.

The police regained control early this morning after the rioters, some of them belonging to the extreme-right movement, set cars on fire and ransacked the television building.

The catalyst for the demonstrations was the revelation of an extraordinary admission made by Mr. Gyurcsany to a Socialist Party meeting, shortly after the April election, that he had lied for years about the economy in order to win the election.

In a tape leaked to the media over the weekend and broadcast by Hungarian radio, Mr. Gyurcsany had told his party that the government had lied about the need for austerity measures to stop a burgeoning budget deficit. “We lied in the morning, we lied in the evening,” he said.

Mr. Gyurcsany said Sunday that the recording was authentic. “We did everything to keep that secret to the end of the electoral campaign,” he said.

At one point, he said his government had achieved nothing during its previous four years in power. “We screwed up, big time,” Mr. Gyurcsany said. “No country in Europe has been so blatant. We obviously lied through the past one and a half to two years. And meanwhile, we didn’t do a thing for four years. Nothing.”

Mr. Gyurcsany, a former businessman and millionaire who made his fortune in the early 1990’s during the chaotic years of privatization just after the collapse of the Communist regime, become the first Hungarian prime minister since 1989 to lead a party to a second term.

During the election campaign, Mr. Gyurcsany frequently told voters that the budget deficit was under control. He said it was about 4.7 percent of gross domestic product. But Hungary’s central bank repeatedly published figures showing that the deficit was almost 10 percent.

Despite these warnings, Mr. Gyurcsany promised voters higher pensions, lower taxes and protection for Hungary’s welfare system.

The spiraling budget deficit meant that Hungary would have no chance to meet its target of adopting the European Union’s single currency, the euro, in the near future unless Mr. Gyurcsany introduced stringent savings and embarked on radical reforms aimed at cutting public spending and the bureaucracy.

Mr. Gyurcsany reversed course this month when he said he would introduce higher taxes, health charges and student fees in order to rein in the deficit.

He said he wanted to lower the budget deficit to 3.5 percent in three years.

His admission of lying has eroded support for the Socialists only two weeks before local government elections. Polls show 34 percent of respondents support Fidesz, compared with 23 percent for Mr. Gyurcsany’s coalition.

“The events in Hungary show that the transitions are not finished,” said Ivan Krastev, director of the Center for Liberal Studies in Sofia.

“You have seen what has happened in Poland and Slovakia. There, politics over time became exclusive. People felt they had no right to influence decision-making because of the way these elites governed. This is why you have an appeal to populism and a slowdown of reforms.”

Poland’s center-left government of former Communists was defeated in October by the conservative Law and Justice party, led by twin brothers, Lech and Jaroslaw Kaczynski.

The twins — Lech is president and Jaroslaw is prime minister — promised to purge the bureaucracy, judiciary and security services of former communists, corrupt officials and those who may have informed for the secret police.

They also want to give the state a greater role in the economy.

In Slovakia, after several years of economic growth and reforms under the center-right government led by Mikulas Dzurinda, voters in June elected the Socialist leader, Robert Fico. Mr. Fico established a coalition government of populists and extreme-nationalist political parties whose stint in power during the 1990’s had isolated Slovakia and prevented it from joining either NATO or the European Union until 2004.