The EU has taken Hungary hostage

The European Commission abuses its powers over the recovery fund.

According to EU regulations, Hungary is entitled to HUF 2,500 billion from the EU funding package for the Covid pandemic in order to repair the economic and social damage. The payout rules state that funds may be transferred once it is authorized by the European Council. For the Council’s decision to occur however, the European Commission must first analyze the recovery plan proposed by the Hungarian government and submit it for approval. 

The EU regulations clearly set out the priorities and assessment criteria for Member State recovery plans. They also specify to what extent these criteria can be enforced. The European Commission however has violated several of these mandates with regard to their treatment of Hungary. It arbitrarily ignores the true purpose of the examination to analyze the recovery and resilience plan to tackle the Covid pandemic.

By ignoring the confines of the legislation, the European Commission has imposed legislative and governmental requirements which echo the rule of law attacks against the Hungarian public law system. In doing so, this body abuses its powers over the recovery fund as it does not fulfill its purpose set out by the EU regulation, but rather takes advantage of its role to manipulate the rule of law debate. Ironically, the Commissioner of Justice, Didier Reynders said: “We need to use all our tools: the Article 7 procedure, infringement procedure, and, as most recently available, the rule of law mechanism for EU recovery funds and our negotiating position.”

Thus, the recovery fund seems to be inseparable from the years-long tug-of-war over rule of law. The topic of rule of law is especially important to Brussels because it allows EU administration to dictate areas of national competence where, according to the founding treaties, EU law would not apply. In the absence of EU-wide regulations, rule of law is the mechanism by which Member States’ governments are required to voluntarily overhaul legislation that defines their social order if it is not in accordance with the left-wing hegemonic conception of rule of law. They demand this even when there is no electoral majority behind these changes, which goes against the democratic, parliamentary system. This is why the current Hungarian government – legitimately elected and responsible for the expectations of the electorate – refuses to subordinate their two-thirds electoral majority to the will of Brussels. 

In this case, two basic methods can be put into practice by the EU to enforce the dominant left-wing ideology on “reluctant” Member States. One is legal sanctions, the other is withdrawing financial support. As the Justice Commissioner stated, both methods will be implemented against Hungary. The Article 7 procedure and the infringement proceedings belong to the former category while the extended application of the rule of law mechanism to the EU budget for Covid recovery would fall under the latter. 

The logic is clear with the second category: to create an economic disadvantage relative to other regional Member States, which inhibits the country’s ability to retain jobs, maintain income levels and implement family support tax incentives by weakening the country’s capacity to attract investment and capital. According to their intentions, this could lead to social discontent which would eventually help to shape the will of the electorate to vote against their current government.

Hungarian citizens are in fact being held hostage – signaling that, in exchange the correct votes, the left-wing EU political and financial quarantine will be lifted. Therefore, during the recovery fund negotiations, Secretary of State Szabolcs Ágost­házy, who is leading the Hungarian delegation, is essentially working as a hostage negotiator for the Hungarians to be freed of this discriminatory treatment. However, there does not seem to be much will to cooperate on the part of those holding the hostages. It seems that the two-months deadline set this past summer by the EU regulations for the Commission to approve the government plans was for nothing; this had to be extended by a month to respond to the continued objections in Brussels. However, by the end of September, still no date had been set for finalizing the plans’ approval.

Incidentally, the incoming German governing coalition which has significant sway over the EU, has announced their program. One aspect includes urging the EU institutions to “more consistently and quickly use all resources possible” to exert more pressure on Poland and Hungary. The Ursula von der Leyen-lead European Parliament has not needed any additional encouragement to do so, and their efforts to block funding to Hungary have now only been strengthened. It is an unfortunate fact that Hungary cannot expect any substantive legal solution from the European Court of Justice either because the panel’s decisions make it clear they consider the EU treaties as (left-wing) ideological documents and see it their mission to enforce that ideology. The decisions brought in the cases of the Sargentini report and the mandatory migrant quotas cannot be read without a sense of second-hand professional shame. Moreover, the seemingly unnecessary court process is so lengthy anyways that it calls into question the purpose of it in the first place.

These are the circumstances under which the Hungarian government has had to replace the illegally withheld EU recovery funds with money from financial markets which has been made possible by the successful economic results of the past years and minimal debt. This has freed the country from the European Commission's financial trap and protected the rights of Hungarians to free and independent self-determination.

The author is a lawyer specializing in European law

Photo: European Union flag (Photo: Flickr)