Thursday, January 12, 2012

Will Hungary become the focus of the EU's attention, or is the Central Bank all they are really concerned about

For much of 2011 the center of attention in Europe had been Greece (followed by Italy). As the Greek debt crisis continued the Socialist prime minister was eventually replaced with a technocrat, Lucas Papademos, a former Vice President of the European Central Bank. Not long afterward the Italian Prime Minister Silvio Berluscon was replaced by Mario Monti.

Today the New York Times published a story on what may be the big story in Europe this year, Hungary.

Faced with what critics say is an alarming drift away from democracy by one of its members, the European Union gave the Hungarian government a final warning Wednesday that it would face the start of formal legal action by next Tuesday unless it modified a series of measures that threaten the balance of power in the country.NYT
At the center of the debate is Fidesz, the right-wing political party that has control of the levers of government, and has been pushing through laws that are meant to guarantee its continued control.
In 2011, only the laws concerning the media seemed to get much play (what a surprise), but now it is the move to end the independence of the Central Bank that has caught the attention of the EU.

Hungary has its own debt crisis, so the government of Prime Minister Viktor Orban needs to be able to access credit. But can the EU really accept a non-democratic state within the organization?

For further background I would recommend this blog post at European Tribune: Protest in a one-party state.