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Social Trust in Orbán’s Hungary
Economist Philip Pilkington moved to Hungary recently, and discovered that everything he’d heard about the country was propaganda created by liberals who know that liberal societies are unraveling.
Apr 24, 2024
Four weeks to the day I arrived in Budapest. I knew a little bit about the country. I had dropped in for a few days here and there—even getting to know some of the political circles. Naturally, I did not believe a lot of the nonsense that you read about Hungary. Even a modicum of experience will tell you that the vast majority of what you read is rot. The first time I visited a few years ago, on the way back from the airport ago the taxi driver—a very outspoken critic of the government—subjected me to an unsolicited twenty-minute rundown of every corruption scandal in the country since the present prime minister took office. “If this is what a society without limited freedom of speech looks like,” I thought to myself, “then what on earth is the contemporary Anglosphere—where working people walk on eggshells for fear of offending the latest fad—supposed to be?”
That said, I did not really know what to expect at a deeper level. After all, you would have to be a bear of little brain to believe all the hyperbole about dictatorship, the suppression of dissidents, and all the rest of it. But perhaps there was some truth to the idea that it is effectively an oligarchy, run by the few for the few at the expense of the many. Perhaps it was true that Hungary was moving to become a central European hermit kingdom, isolated from the rest of the world. Maybe, just maybe, despite the occasional vocal taxi driver, most dissidents sulked in the shadows, unable to speak out—and this created the sort of social distrust that many reported as being a hallmark of the Soviet societies of yesteryear.
Alas, I have found that none of this is true. Indeed, on every point it is the opposite of the truth. There is propaganda, andthen there is propaganda. Simple propaganda bends the truth—the spin doctor applies his spin, as we are so fond of sanitizing the corruption of our political processes in the West. Dark propaganda—the type that blackens the soul—tells us the opposite of the truth. In Orwell’s 1984 Big Brother is not content until poor Winston Smith admits that 2 + 2 does indeed equal 5. Hungary, I am afraid to say, has not simply been spun—rather it has been blackened, and we in the West are far worse off for it.
Oligarkhía, oikonomia
Hungary, we are told, is an oligarchy. The people who use this term today are typically too stupid to know its etymology and its historic application. They are mucky lawyers rather than Plato scholars. What they mean by oligarchy is not the sort of corrupted political regime we read about in Plato’s Republic, but rather a society in which free competition is not allowed to work its magic and shadowy forces behind the scenes bend the arc of wealth to their own ends. Not, of course, like contemporary Congressional procurement or bills like the Inflation Reduction Act which dole out countless billions to politically connected insiders. No, that is all part and parcel of a healthy democracy. Oligarchy is something altogether darker—something altogether more Eastern.
What would an economist expect if an oligarchy that fit this modern definition was taking shape? Well, the concentration of wealth, of course. Economists can measure this quite easily these days by using Gini coefficients. A glance at the Gini coefficients does not tell us the oligarchic story, however. Hungary’s Gini coefficient sits at no. 14 in the OECD rankings, roughly the same as Germany. The United States sits last, of course, just behind Britain—that other bastion of anti-oligarchy.
But perhaps we are measuring oligarchy wrong. Perhaps having a terrible Gini coefficient does not signal that a country suffers from oligarchitis, but rather that the cream is rising to the top. That is, having a highly unequal society may signal (the anti-oligarchy liberals might tell us) that we have a more competitive society.
Well, let us take a different measure of oligarchy then. Let us not focus on wealth concentration per se, but rather on wealth concentration by geographic locale. Conceivably the liberals might be correct: high income inequality may signal more competition. But if all these highly innovative “entrepreneurs”are concentrated in a small number of geographic regions, it seems more likely that they are plotting in smoke-filled rooms. What has happened, then, to regional inequality in Hungary since Orbán was elected? Let’s look.
The following chart shows the regional Gini coefficients between the beginning of the present run of governments led by Orbán (2011) and when the study was undertaken (2017). A steeper, more u-shaped curve indicates more regional inequality. A less steep, flatter, or even n-shaped curve indicates less inequality. As we can see, county-level inequality has crashed out, while district-level inequality has fallen substantially. This is not what an oligarchy is supposed to look like! Orbán and his cronies seem to be spreading the wealth—like some sort of nefarious oligarchical Robin Hood!
Here it is worth comparing the situation in Hungary to that of the United States. This chart, from the Department of Commerce is simpler to read. The message is straightforward: regional inequality is rising and has been for a long time. Either that means that something resembling an oligarchy is forming in the United States or all the highly talented entrepreneurs just happen to be living next to one another. A clue to this might be to look at which is the wealthiest region in the entire United States: it is Washington, D.C.
The reality is that Hungary is becoming less regionally unequal because the government focuses not so much on national development as on regional development. Rather than trying to build up small pockets of wealth—as is popular in “liberal democracies” like the United States and the United Kingdom—the Orbán government has sought to channel investment into areas that need it. Take the example of the recent Chinese EV production facility being set up in Hungary: although a crown jewel of recent Hungarian economic policy, it will not be in Budapest but rather in Szeged in Hungary’s Southern Great Plain. Maybe the “liberal democracies,” with their crippling regional inequality and accompanying political instability, should pay attention.
Amicitia et societas
“Well, perhaps Hungary has higher levels of regional equality,” our liberal oligarchy-hater might say, “but the same was true under Communism. Of course, Hungary is achieving this by becoming an ever more closed society.” It should be noted that the date of writing is April 2024. The “liberal democratic” West is currently obsessed with closing trade with what seems to be most of the world—which has been deemed “evil.” United States Treasury Secretary Janet Yellen traveled to Beijing at the time of writing to inform the Chinese that they were engaged in too much trade and making products that were too competitive. No matter. Liberal democracy, we are assured, is less a set of principles and more so a feeling—a “vibe,” perhaps.
Surely though, as the liberal democracies go insane, light their hair on fire and tear up all their “principles,” Hungary is using this opportunity to dial up their own “Closed Society Coefficient” in their already closed society. After all, we are told, the Orbánists dislike George Soros—and Soros promotes the Open Society. (The Open Society is promoted by closing off trade with China—it is all very confusing.) Well, no need to be confused by the strange limb-twisting activity of our liberal democratic compatriots, Hungary’s position on relationships with other nations is straightforward enough. In fact, Balázs Orbán, the Political Director of the Prime Minister, has just written a book about it entitled Hussar Cut.
Balázs Orbán, and he has been backed by the Prime Minister in this regard, is promoting a strategy of what he called “connectivity.” Connectivity is opposed to both free trade-based globalization and protectionism—the two fashions that our confused liberal democratic political elite have fallen prey to these past two decades. Whereas the liberals tilt toward either extreme based on whatever feeling or “vibe” they are feeling on any given day, connectivity is about moderation. “Yes, we should trade and engage mutually beneficial commerce,” its proponents say, “but we should not do so in a blindly ideological fashion. Rather we should put the interests of our nation first and the pragmatically build our international, diplomatic and trade relations around it.”
This is pretty sensible stuff. In a world where a liberal cannot tell you if dogmatic free trade or dogmatic protectionism is the way forward—much less if a man is a man and a woman is a woman—there is a certain clarity to this connectivity concept. Fortunately, for the reader who does not read Hungarian, a fantastic discussion is available online hosted by the Danube Institute and chaired by Postliberal Order’s own Patrick Deneen. This discussion is strongly recommended for readers interested in international relations, trade, diplomacy and economic and are not moved by the jittery intellectual contortions now undertaken daily by our enlightened liberal elite.
From dēmokratia to agape
All of this is very high-level stuff. Macroeconomic distribution? Highbrow international trade and diplomacy? These sorts of things are not approved talking points amongst our liberal literati. “That is all well and good, Mr Economist,” they will say, “but what about the general feelings on the ground—what about the vibes?” Economics training is, of course, notorious in numbing the capacity of human beings to feel anything. But the present writer will do his level best.
First, what are my points of comparison? I have lived in Ireland, the United Kingdom, and the United States (Massachusetts, for our American particularists). There are two aspects of Hungarian political sociology that have stood out to me after spending a month here. The first is how politically engaged people are. We have already encountered our dissident taxi driver, eager to lecture naïve foreigners on the corruption of the regime. In fact, there are many dissident taxi drivers—they seem to have migrated into all the professions, especially ones that immediately interact with foreign visitors. They speak their minds—Lord knows they speak their minds. And they seem to assume that every English speaker will agree with them. A strange conceit—one wonders where it comes from.
But more interesting than the flamboyant opposition are the silent—or, more properly, quiet—majority. These are the people who fix your electricity, who you talk to waiting in the post office, and who you encounter if you try to burst the “tourism bubble” and see the real Hungary. They are politically engaged too. But not in the same way as the more obsessive opposition. They see the government as defending what is theirs, as doing their best in a set of hard circumstances, and they see the opposition as interlopers and bohemians. They are somewhat shy about their opinions in front of English-speaking foreigners, but with a little gentle pressure and a nod and a wink they will reveal “their truth,” as the liberals are fond of saying.
Related to these “little hidden platoons” is the surprisingly high levels of trust in Hungarian society—at all levels. This high level of trust does not differ between working class Orbánists and bourgeois bohemians, nor do they distrust each other—despite the high level of political polarization. Trust is the name of the game in Hungary—surprising for a post communist country. After an hour of meeting someone who is providing you with a service and you have forgotten to take out cash, you can apologize, and they will shrug it off and ask you to drop it off the next day—despite their English being broken and your Hungarian being nonexistent. Even in the poorer suburban districts around Budapest you will find punnets of fruit that the resident has grown in their garden left on a small table with a jar next to it; you leave the money and take the fruit, no one is watching—except perhaps God. There is very little visible crime or squalor and the police—although they are armed, and they seem tough enough—interact with the community harmoniously. Children play in the streets, parents seem unconcerned. Neighbors do not seem to be at each other’s throats, and everyone tolerates a certain amount of disorder—from dogs barking at night to hedges that should probably have been clipped a few months ago. There is no squalor, but there is plenty of rustic untidiness.
There is little in the way of social trust left in the Anglosphere, it needs barely be said. In Britain and America, every relationship seems to be managed through “professional” intermediaries. A Marxist might say that every relationship has been “commodified.” I recall in Ireland when I was growing up in the 1990s and early 2000s this was not the case, but it is now. Liberalism and managerialism seem to go hand in hand, with every relationship turned into a contract and every human subject turned into a commercial object. This, together with the high rates of crimes and migration, seems to breed distrust and a conflictual attitude amongst neighbors. It is all very oppressive. Hungary’s greatest challenge, I would say, is to maintain the cordial, high-trust relationships that exist in their society as they grow ever wealthier. And, with their sophisticated economic development program that favors regionalism, and their openness to a world order that is changing rapidly, it seems very probable that they will prosper. The liberal democratic countries on the other hand? They seem in for a rough ride.
