Donald Trump famously promised Americans they would get tired of winning. For sixteen years, the nation of Hungary was run by a man named Urban Winner. On April 12, Hungarians voted that man, Prime Minister Viktor Orbán, out of office. But while Hungarian voters may have tired of being winners, they do not seem to have tired of being Magyars. In Hungary’s 199-seat parliament, Péter Magyar’s Tisza party defeated Orbán’s Fidesz party by a margin of eighty-nine seats.
“Everybody knows” Orbán was the bad guy: frequently called an authoritarian or even a dictator, he was anti-immigrant, pro-Putin, Trump’s best friend in Europe, and the EU’s most persistent antagonist. U.S. media tends to portray Orbán’s project principally in terms of America’s own culture war battle between “establishment liberals” and the “populist Right.” Orbán’s government itself often promoted such a framing. A friend from college posted on Facebook: “Eat shit, Orbán. Trump, you’re next.” Clearly, I am being invited to pick a side without informing myself.
Naturally, I decided to inform myself.
Why did Hungarians decide to vote for this man for sixteen years? And why did they stop? How did the qualities that made Orbán popular early in his tenure become liabilities after years in power?
What is a Tyrant?
When an entrenched elite blocks reform through its control of governance bottlenecks, sometimes the dispossessed majority supports a strong man to override them. The Greeks called him a tyrant; the Romans, eventually, called him a dictator.
While often morally charged today, the word “tyrant” originally described how one got the job: power seized against the established order. Peisistratus seized power in Athens with popular support, redistributed aristocratic lands to the poor, and governed well enough that Athenians said his rule was like the age of Kronos.
The people throw their weight behind a tyrant to address grievances that the incumbent regime cannot or will not address through its ordinary functioning. The tyrant and his trusted lieutenants bring the government in line, but the institutional capture that enables reform is the same power that enables extraction, and the tyrant’s inner circle may be counting on that. Every reform the tyrant delivers strengthens his mandate; every state contract he steers to an ally increases his exposure. The question is whether he can convert his position into something self-sustaining before the liabilities overtake the assets.
Cincinnatus was a Roman consul who, when his term ended, retired to his farm. When a military emergency arose, he was called back to serve as dictator with absolute authority. He defeated the enemy in sixteen days, resigned his commission, and went back to his farm. Internal crises are harder. Sulla marched on Rome, seized the dictatorship, rewrote the constitution, killed his enemies, and retired to his villa. Within a generation, the republic collapsed into civil war anyway, and what followed was Julius Caesar, who marched on Rome, broke a multi-generational deadlock on land reform, and won eternal fame.
The simplest thing consistent with such a figure’s survival is to establish a dynasty, as Augustus did at the end of the civil wars that followed Caesar’s assassination, achieving escape velocity beyond lifelong rule. If he is very ambitious, he tries to do the lawgiver’s work: use the temporary authority to create a new constitutional order beyond personalistic or even dynastic rule, as Solon did for Athens, Lycurgus for Sparta, and Moses for Israel. Solon was given emergency authority during a debt crisis, rewrote the laws, and fled the country so they’d have to work without him.
Orbán danced until the music stopped, and he lost by eighty-nine seats.
The Mortgages Were in Swiss Francs
When Orbán was elected in 2010 (he also previously served as prime minister from 1998 to 2002), roughly 100,000 Hungarian families (out of about four million households in the country) were severely in arrears on their mortgages. Over a million more were struggling. They had taken out loans denominated not in Hungarian forints but in Swiss francs. The forint collapsed, and their monthly payments rose 70–80 percent. They couldn’t pay, and since property values had crashed, they couldn’t sell, either. Within two months of taking office, Orbán imposed a moratorium on evictions.
How did a million families end up holding currency risk they didn’t understand? The proximate answer is simple: while forint mortgage rates were 10–13 percent, Swiss franc rates were 3–5 percent. Foreign-owned banks marketed foreign currency mortgages aggressively, pushing into lower-income segments as they competed for market share. Regulators didn’t intervene. By 2008, over 60 percent of all household mortgages were denominated in foreign currencies, mostly Swiss francs. Early borrowers were middle-class families making a rational bet on a stable forint. But as banks competed for market share, they pushed deeper into lower-income segments, to families borrowing not to upgrade their housing but to cover gaps between income and basic costs, or to refinance more expensive existing debt.1 When the forint collapsed, the crisis was concentrated among these lower-income borrowers, living in poorer regions, with the worst collateral.
The deeper answer is that forint rates were so high because Hungary’s government had been running deficits of 7–9 percent of GDP from 2002 to 2006 (the worst in the EU), buying votes through public sector wage hikes and election-time transfers rather than building productive capacity.2 Hungary had joined the European Union in 2004, expecting its economy to converge with the West, as Poland, Czechia, and Slovakia were doing. It didn’t. Real wages stagnated from 2003 to 2010. In September 2006, a leaked recording captured Prime Minister Gyurcsány telling his own caucus that they had systematically deceived the public about the economy. Street riots followed, but Gyurcsány lasted in office for another two and a half years. Hungary’s institutional architecture made it difficult to remove a sitting government outside scheduled elections.
Then the 2008 financial crisis hit. Hungary became the first EU member state to need an IMF bailout, before Greece. GDP contracted roughly 7 percent in 2009, while neighboring Poland grew 2.6 percent. The IMF imposed austerity: Hungary cut public sector wages, froze pensions, raised the VAT to 25 percent. Unemployment rose from 6 to 11 percent. Families reduced spending below subsistence, moved in with parents, or left the country.
Prime Minister Gyurcsány resigned in March 2009. But the system that had produced the crisis was not the work of one man or one party. Every postcommunist Hungarian government had run a version of the same patronage program: state resources (first from privatization proceeds, later increasingly from EU structural funds) flowed through politically connected intermediaries who provided campaign financing, media support, and jobs for allies in return. The pre-Orbán Socialists had their own network of businessmen who profited from the 1990s privatizations, and their own patterns of directing EU-funded contracts to allies. The scale of this extraction was limited by its own decentralization: multiple independent actors with their own power bases, competing for access, were held in partial check by courts, prosecutors, media, and each other. The institutions that had failed to prevent the crisis were part of the same system.
To Hungarians who noticed this, which was most of them, “institutional independence” meant that institutions protected a government which everyone knew was lying. Voters didn’t just want a new majority to dominate the same system. They wanted someone to override the institutions that had produced and protected the old one.
Orbán and his Fidesz Party won the April 2010 election with 53 percent of the popular vote and 263 of 386 seats. This gave him the two-thirds supermajority required to amend Hungary’s constitution.
Cut a Great Road through the Law
Between 2010 and 2013, Orbán used his supermajority to restructure every check on his power. The people’s tyrant needs to clear governance bottlenecks; that’s the whole point of the mandate. But did the restructuring address public problems, or merely remove a check on the prime minister’s personal power?
Judiciary.Before Orbán entered office in 2010, the Constitutional Court had been blocking fiscal reforms during an economic crisis. Orbán expanded it from eleven to fifteen seats, filled the new seats with allies, and stripped its jurisdiction over budget matters. He lowered the judiciary’s retirement age from seventy to sixty-two, forcing out roughly 274 judges, or about 10 percent of the total judiciary of 2,900, disproportionately those in senior positions. He also installed a new National Judicial Office, headed by the wife of a founding member of Fidesz, with control over budgets, appointments, and case assignments. The result was a captured judiciary, though the reform helped to solve the immediate fiscal problem.3
Similarly, an independent prosecutor is a check on the government by design, and any check is a potential bottleneck. From the perspective of voters who elected Orbán to act, a prosecutor who had served under the old regime was part of the problem. Orbán’s nominee, Péter Polt (a Fidesz founding member), received a newly extended nine-year term. Under Polt, corruption complaints involving government officials were overwhelmingly dismissed, and Hungary declined to join the European Public Prosecutor’s Office.4
Media. Hostile media are a check on the unitary executive’s capacity to shape the national narrative. Pre-Orbán Hungarian news media were competitive and pluralistic (Freedom House’s 2010 Press Freedom survey ranked Hungary as tied for fortieth freest in the world). But they were predominantly owned by companies in Zurich and Berlin, and accountable to no Hungarian institution. The new regulatory authority, with a nine-year presidential appointment controlling broadcast licensing and content, made the media accountable to one Hungarian: Viktor Orbán’s appointee.
Parliament. Parliament was cut from 386 seats to 199. Before this reform, roughly 26,000 people were represented per seat; after, close to 50,000. This was a move toward the European norm. Parliaments in France, Germany, and the UK represent more than 100,000 people per seat, and in neighboring Poland, 83,000 per seat. But the reduction came packaged with structural changes. The old runoff system, which had allowed opposition voters to consolidate behind a single candidate in a second round, was replaced with first-past-the-post, so a fragmented opposition could lose a district even with a collective majority. Districts were redrawn behind closed doors, and a rule that originally counted votes for a party in a district it lost toward that party’s proportional-list allocation was rewritten to double-count the winning party’s margin of victory in each district as bonus seats in the proportional allocation. In 2014, Fidesz won another supermajority with only 44.9 percent of the vote, impossible under the prior rules.
In addition, roughly thirty policy areas, including tax rates, pension rules, and electoral law, were designated “cardinal laws” requiring a supermajority to change.
Central bank. After the financial crisis, lending to businesses had collapsed, and orthodox monetary policy during a stagnant economy was choking the recovery. In March 2013, Orbán replaced the governor with his former economy minister, György Matolcsy. Orbán explained his choice bluntly: “I need an economic politician, not an economist.” The base interest rate was cut from 7 percent to below 1 percent over three years, and the Funding for Growth Scheme that followed added about 2 percentage points to cumulative GDP growth from 2013 to 2016.5 Through the latter program, the central bank provided interest-free funding to commercial banks, which lent to small and medium-sized businesses at a capped 2.5 percent rate.6 The Funding for Growth Scheme channeled roughly HUF 2.8 trillion (€8–9 billion) to nearly forty thousand companies.7
What Orbán Delivered
In 2014–15, the government forced conversion of all foreign-currency household loans to forints at a rate significantly more favorable to borrowers than the market rate. Banks (predominantly Austrian, Italian, and German-owned) absorbed €3–4 billion in losses. Roughly a million families saw their mortgage payments drop by a third or more overnight.8
Foreign ownership of the banking sector subsequently fell from 65 to 50 percent. Windfall taxes and the forced currency conversion drove foreign banks out; state-connected buyers acquired their Hungarian operations. Credit allocation within Hungary was increasingly decided not in Vienna and Milan but in Budapest.
Hungary’s cheap labor and EU market access had been drawing foreign manufacturers since the 1990s. Orbán accelerated this trend in 2017 by cutting corporate tax rates from 19 percent to 9 percent, the lowest in the EU, while also offering repeated minimum wage increases. Unemployment fell below 4 percent, and real net earnings rose by more than 70 percent between 2014 and 2024, though the 2022–23 inflation crisis temporarily erased several years of gains.9 Orbán replaced unconditional welfare with a public works program (közmunka) that employed roughly 200,000 people at below-minimum-wage rates (€230/month) doing make-work; local mayors, overwhelmingly Fidesz, controlled who was assigned, and in the poorest regions, közmunka was often the only available employment.10 Orbán replaced the progressive income tax with a flat 16 percent rate (later 15 percent), and raised the VAT from 25 percent to 27 percent, the highest in the EU. The effect was regressive: top earners’ tax bills fell while the poorest paid proportionally more at the grocery store, though other Fidesz initiatives—raising minimum wages, energy policy, and family policy—targeted lower earners.
Starting in 2013, Orbán froze household gas and electricity prices roughly 25 percent below their 2012 levels. Monthly bills displayed how much each household saved. When global wholesale energy prices dropped (2016–21), they fell below even the reduced regulated price. When global prices spiked in 2022 (an election year), MVM had to buy at multiples of the price it was legally required to charge, and the cap resulted in fiscal hemorrhage.
From 2011 onward, Orbán implemented increasingly generous family policies: lifetime income tax exemptions for mothers of four or more children, subsidized housing loans for families (grants up to €25,000 for three-child families buying new construction), free IVF, and student loan forgiveness for mothers. The fertility rate rose from 1.23 in 2011 to 1.61 in 2021, crossing from well below the EU average to above it, while the EU average barely moved. Perhaps thirty-five thousand Hungarians are alive today who would never have been born without these policies. In human terms, this may be the most important benefit Orbán delivered: babies.
In 2015, over 400,000 migrants transited through Hungary (a country of ten million). Orbán built a border fence. The flow through Hungary largely stopped. He refused the EU’s mandatory refugee relocation quotas; domestic polls showed 70–80 percent opposition to the quotas. The EU Court of Justice ruled against Hungary. Orbán ignored the ruling. In 2021, he passed a law restricting lgbtq+ content aimed at minors, again popular domestically, again objectionable to the EU. In each case, Orbán chose visible defiance of widely resented cultural mandates from Brussels over compliance. When the EU froze €700 million over the lgbtq+ law, Orbán chose to lose the money rather than repeal it.
Through all these measures, Orbán accumulated political assets. Institutional control (courts, prosecution, media, central bank) compounded as each capture made the next one easier, costing little domestically in the short run, but accumulating a record of EU rule-of-law violations.
Policy wins for the electorate (mortgages, wages, the border, utility prices) earned Orbán four consecutive elections. But these victories proved to be depreciating assets; voters tend to ask, “What have you done for me lately?” Other measures—the border fence, the lgbtq+ law, and more recently Orbán’s position on Ukraine—further antagonized the EU. The other asset was his patronage network.
The Gas Fitter Became a Billionaire
The Fidesz patronage network sustained Orbán’s coalition but imposed a fiscal drag that gradually hollowed out public services. With courts, prosecution, and media captured, there was no institutional check on procurement. Transparency International Hungary estimated that over 40 percent of procurement procedures involved a single bidder, and companies told the Competition Authority that cartels had become unnecessary because the outcomes were predetermined.
Orbán’s first patronage model was an alliance of equals. Lajos Simicska was Orbán’s university roommate and Fidesz’s former treasurer, whose construction companies received government contracts while his media holdings provided political support. Simicska had independent wealth, independent media, and independent leverage. In February 2015, the two broke publicly: Simicska, on his own TV station, called Orbán a “motherfucker.”
Simicska’s companies never won another government contract. The lesson Orbán drew: autonomous allies are structurally unreliable. The old, decentralized model had survived because no single actor could dominate it. Orbán replaced it with unconditionally dependent figures.
Lőrinc Mészáros was a gas fitter from Orbán’s village, who nearly went bankrupt in 2007. In 2010, he still had nothing, but by 2018 he owned 203 companies and his net worth had risen to $1 billion; by 2025, $4 billion. Asked to explain, he once attributed his success to “God, luck, and Viktor Orbán,” presumably in increasing order of importance. A 2026 Financial Times investigation found thirteen companies run by Orbán associates won over €28 billion in state contracts after 2010.
In November 2018, 476 media outlets were donated to a single Fidesz-aligned foundation in a single day, exempted from antitrust review. The foundation, KESMA, held a modest share of Hungary’s total media market by revenue, but it included all regional newspapers, the only nationwide commercial radio station, and a dominant share of news and public affairs programming, giving it effective control over the information environment outside Budapest.
Independent investigative outlets survived and spent a decade documenting what the captured institutions wouldn’t touch: tens of millions in EU procurement fraud, Pegasus spyware deployed against journalists, corruption complaints systematically dismissed by the prosecutor’s office. None of it produced political consequences. The prosecutor wouldn’t prosecute, controlled media wouldn’t cover it, the opposition was too fragmented to mount an effective challenge, and voters seemed more or less satisfied with the deal they were getting. But in the 2020s, the bills started coming due.
Insufficient Funds
Hungary spent 7.4 percent of GDP on health in 2009, before Orbán took office. By 2022, that number had fallen to 6.5 percent, while the OECD average rose to 9.3 percent, and Visegrad Group peers Czechia and Slovakia spent 7.8 and 7.2 percent, respectively. The decline in real domestic health spending was not an accident: as EU funds flowed in, the domestic health budget stagnated in nominal terms and declined in real terms. EU money substituted for domestic spending rather than supplementing it, freeing domestic revenue for the patronage circuit.
When Hungary joined the EU in 2004, its physicians gained the right to work anywhere in Europe. Hungarian medical salaries were a fraction of German or Austrian ones. Doctors left, and the government didn’t raise pay to stop them; by 2021, roughly 1,500 medical professionals were leaving annually. In October 2020, the government tried a different approach: Act C on Healthcare Service Relationships replaced healthcare workers’ public employment status with a system modeled on the armed forces. Doctors received a 120 percent salary increase, but the law required special permission for simultaneous private practice, criminalized the informal payments that had long supplemented low wages, and gave the state power to reassign workers anywhere in the country for up to two years. Nurses and other staff received no comparable raise. On March 1, 2021, in the middle of the third wave of Covid, roughly 4,000 to 5,500 healthcare workers out of approximately 110,000 refused to sign the new contracts and lost their jobs.11 Hungary had plenty of hospital beds (6.5 per 1,000 people, above the EU average) but not enough doctors to keep them open. A single retirement sometimes shuttered an entire department.
Schools suffered too. In 2013, Orbán transferred control of schools from municipalities to a centralized national authority. He kept education spending at 5.8 percent of government expenditure, dead last in the OECD. Teacher salaries stood at roughly two-thirds of average graduate pay, compared to about 90 percent across the EU; nearly half of teachers were over fifty, and replacements could not be found at those wages. When teachers engaged in civil disobedience in 2022, refusing to follow the national curriculum for a day to protest their conditions, the government fired them. PISA reading scores fell from 494 (2009) to 473 (2022), a drop equivalent to roughly two-thirds of a year of schooling.
Meanwhile, politically connected contractors received roughly €1.9 billion per year in government contracts. Closing the teacher salary gap would have cost one-ninth as much. The government built the Puskás Aréna in Budapest for €610 million. It built a four-thousand-seat stadium in Orbán’s home village of Felcsút, population 1,600. It built a €1.5 million roundabout for a railway that was never built. The money for teachers, doctors, and schools existed. It went to contractors who returned the favor at election time.12
The Price Caps Made Prices Go Up
When Covid arrived in 2020, Orbán’s central bank governor, Matolcsy, cut the base rate to 0.60 percent, bought bonds that expanded the national bank’s (MNB’s) balance sheet by roughly 10 percent of GDP, and kept lending programs running through mid-2021, even as inflation surpassed 5 percent. The broad money supply grew 35–40 percent in two years. The MNB didn’t raise rates until June 2021, well after prices were already accelerating.
Into this already overheated economy, the government injected roughly €4.6 billion (3.3 percent of GDP) in pre-election transfers: income tax refunds for 1.9 million parents (disbursed in February, about eight weeks before the vote), thirteenth-month pension payments, a 20 percent minimum wage hike, a tax exemption for workers under twenty-five, fuel price caps, and food price caps on six staples.13 Fidesz won the 2022 election with 54 percent of the vote.
Five weeks earlier, Russia had invaded Ukraine. Hungary depended on Russia for 80 percent of its gas, largely from inherited Soviet-era pipeline infrastructure, though Orbán did sign a new fifteen-year Gazprom deal in September 2021. The utility cap mandated in 2013 cost the state roughly €2.6 billion in 2022 alone. On August 1, 2022, the government removed the cap for people consuming more than average; they saw gas prices jump roughly sevenfold. The fuel cap was removed for everyone else in December.
Food price caps backfired: retailers compensated for losses on six capped items by raising prices on everything else. Food inflation peaked at roughly 45 percent.
The forint collapsed from 330 to 430 per euro. The immediate triggers were the energy import bill, which roughly doubled as gas prices spiked, and a risk premium from the EU funds dispute and Hungary’s alignment with Russia. But years of loose monetary policy had left the forint with no buffer. When the MNB finally hiked to 18 percent in late 2022, the forint stabilized, even though the energy shock and the EU dispute were still ongoing, confirming that the monetary stance had been the decisive vulnerability.
Hungary’s inflation peaked at 25.7 percent; its central European peers peaked at roughly 17–18 percent. The energy and commodity shock hit all of them. The forint’s collapse and the backfiring food caps pushed Hungary’s number higher, and both were consequences of policy choices. Matolcsy himself estimated that the food price caps alone increased inflation by 3–4 percentage points.14
Real purchasing power declined 14 percent over eleven months. The cumulative price level rose 57 percent from 2020, nearly double the EU average. By December 2022, even Matolcsy publicly stated that “the economic policy coherence of the government and the central bank has broken down.” The growth model was also failing: when Germany’s auto sector weakened in 2023–24, Hungarian industrial production fell 5.5 percent and then 4.0 percent.
The EU Had a Lever
The European Union transfers substantial money from richer to poorer member states through “cohesion funds.” For Hungary, these averaged 3.5 percent of GDP annually after 2010. From May 2004 through December 2023, net EU transfers totaled €67.8 billion (€3.45 billion per year). Without them, growth would have been 0.7 percent instead of 2.1 percent.15
Some of these funds were explicitly conditioned on “rule of law” standards, such as judicial independence. This turns out to be important enough that it’s worth explaining the exact meaning of the standard. When the EU says that a judiciary lacks “independence,” it doesn’t evaluate whether specific court decisions are corrupt. It evaluates whether judicial appointments follow EU-approved procedures. If not, the outputs are automatically suspect, and funds channeled through those court systems are deemed at risk. The substantive question of whether these courts rule wrongly in ways that favor insiders is never directly evaluated.
In the English political tradition, an independent Parliament could threaten to withhold tax revenues if it found the executive’s behavior intolerable. In the United States, the independence of the Federal judiciary affords Congress an additional avenue: it can specify bureaucratic procedures through measures like the Administrative Procedure Act, and expect Federal courts to demand compliance. The EU’s leverage against Hungary is mainly fiscal; it can cut off funds, or not.
For a decade, the EU brought proceedings, held hearings, issued reports, adopted resolutions, expressed concern, and expressed grave concern, in Council conclusions, joint statements, press releases, letters from the Commission president, and strongly worded communiqués—but declined to pull the fiscal lever.
On February 24, 2022, Russia invaded Ukraine. Orbán obstructed sanctions against Russia, blocked aid packages to Ukraine, and became the EU’s most visible obstacle to a unified response, eventually escalating to an outright veto of sanctions in 2026. On April 27, 2022, the European Commission notified Hungary that it was initiating proceedings under the Conditionality Regulation.
On November 30, 2022, under the Recovery and Resilience Facility, the European Commission conditioned €5.8 billion in grants to Hungary on twenty-seven reform milestones, including the restoration of judicial independence and new anti-corruption safeguards. This was in effect a demand to reverse Orbán’s 2010–13 campaign of institutional capture.
On December 15, 2022, the Council of the European Union approved the Recovery and Resilience Facility freeze. The Council also froze €6.3 billion in cohesion funds for Hungary, under the Conditionality Regulation, for rule-of-law violations rooted in the same captures: the courts, the prosecution, and the procurement system.
On December 22, 2022, under the Common Provisions Regulation, it froze €22 billion for violations of the EU Charter of Fundamental Rights, citing the 2021 law restricting lgbtq+ content aimed at minors, restrictions on asylum, and deficiencies in judicial independence.16
EU fund absorption fell from 3 percent to 0.9 percent of GDP. On paper, 65 percent of cohesion funds were earmarked for Hungary’s four most disadvantaged regions: the rural northeast and east where Fidesz won eighty-four of eighty-six constituencies in 2022, and where public works employment and EU-funded construction projects were often the main economic activity. In practice, much of the money flowed through centrally connected contractors regardless of project location, so the freeze cut both the regional development pipeline and the national patronage network simultaneously. Hungary became a net EU contributor for the first time. Investment collapsed by 20 percent. GDP contracted in 2023. By December 2024, Hungary permanently lost €1 billion in expired funds.
On October 15, 2023, Poland’s opposition won the election. On December 13, 2023, the new Polish government took power. By December 15, the EU had agreed to release Poland’s frozen funds, before the new government had reversed most of the judicial reforms that had triggered Poland’s own proceedings. Over the same interval, facing a vote on Ukraine’s EU accession talks that required unanimity, Orbán dropped his Ukraine veto and agreed to a package of Hungarian judicial reforms on paper. The EU released €10.2 billion.17 The reforms were largely cosmetic; the system continued to operate as before. But Brussels saved face. The remaining €17–18 billion stayed frozen because other conditions (repealing the lgbtq+ content law, changing asylum policy) required concessions Orbán would not make.
One of the Boys Died
For over a decade, journalists had reported corruption and nothing had changed. Then, on February 2, 2024, the news site 444.hu reported that Hungary’s president, Katalin Novák, had pardoned an accomplice in a child sexual abuse case at a state children’s home, where the director had abused at least ten boys, at least one of whom later died by suicide. The presidency is a largely ceremonial office, but it carries the pardon power, and Novák, an Orbán appointee, had used it. Child abuse was not a venal corruption story, or an argument about EU procedures. It was simple, it was outrageous, and it spread on social media channels Fidesz couldn’t control.
On February 10, the president and former justice minister resigned. Hours later, her ex-husband went public. He was a lifelong Fidesz insider, and he denounced “massive corruption” throughout the system. He appeared on the opposition YouTube channel Partizán the next day. No Fidesz insider had done this before. He reached over two million views in a country of under ten million. On March 26, he released a tape of the former justice minister describing government staff entering the prosecutor’s office to dictate what to remove from a corruption investigation. “This is a mafia government that’s impossible to get out of,” she’d told him. And that ex-husband’s name? Péter Magyar. Yes, that Péter Magyar.
In 2022, energy prices spiked and prices rose 15 percent in a single year. In 2023, the EU froze Hungary’s funds and prices climbed another 17 percent. In 2024, the child sex abuse scandal broke and Magyar released the tape. Most significant opposition parties withdrew from the 2026 race or endorsed Magyar, consolidating behind a single challenger for the first time. On April 12, 2026, with turnout near 80 percent (the highest since free elections began in 1990), Magyar’s Tisza party won 141 seats to Fidesz’s 52, with 53.2 percent of the vote. Orbán conceded.
The Music Stopped
Patronage was not Orbán’s distinctive innovation. Patronage—directing state resources through loyal intermediaries—is how political coalitions hold together, and every postcommunist Hungarian government ran a version. Orbán’s innovation was to centralize it. The decentralized system before him had been corrupt and unresponsive; Orbán’s was corrupt and responsive. But centralized patronage accelerates: yesterday’s bribe is today’s entitlement, so each cycle requires more resources to maintain the coalition.
Nearly all modern states run on deficits if they can. The winners of the World Wars emerged having made more promises than they could keep, and the ones that figured out how to change the financial accounting system to make themselves unaccountable had more degrees of freedom to adapt to the next crisis. The United States emerged in control of a global reserve currency, permitting, for better and worse, a persistent and growing deficit.
When an individual leader has made too many unaffordable promises, they often choose to convert this liability into an asset. In Renaissance Florence, the Medici family lent too much to keep their merchant house solvent on its own—but emerged as the hereditary dukes of Florence. In Erdoğan’s Turkey, foreign capital inflows funded a construction boom that reversed when the capital did. Erdoğan responded with authoritarian entrenchment, replacing the enticement of a share in the profits with the threat of state violence.
Orbán’s extraction was hollowing out public services on a timeline of years, not months. Under different external conditions, the patronage could have continued for another cycle. But Fidesz was trapped: it required EU funds to deliver the material benefits, but to deliver the sovereignty that legitimated the whole project meant defying the EU, a check Orbán could not capture. The energy shock and the pardoning scandal accelerated the collapse, but the trap was structural.
This lever came from outside the democratic system. The procedural class that pulled it had its own interests, blind spots, and extractive tendencies: the December 2023 partial release of €10.2 billion purchased, not mainly rule of law concessions, but Orbán’s consent to Ukraine’s EU accession talks.18
Should Orbán wish it were otherwise? At the end of the Roman Republic, Julius Caesar reallocated public land from a revenue source for the senatorial elite to allotments for veterans and the urban poor; the senators stabbed him to death in the Senate. Orbán, constrained by Hungary’s structural position within the EU, faced an election and lost.
The Magyar Future
Magyar now holds the same two-thirds supermajority that Orbán mobilized to capture every institution described in this piece. He inherits not just a budget under strain but the thicket of cardinal laws that Orbán designed to bind future governments, and judicial and prosecutorial appointments whose terms extend years beyond Orbán’s departure.
Magyar also inherits €17–18 billion in frozen EU funds that reform compliance could unlock. Unlike Orbán, whose domestic mandate and EU demands pulled in opposite directions, Magyar’s incentives point toward EU integration, which includes seizing resources from Orbán’s former clients, something he can credibly call fighting corruption.19
Nevertheless, the EU’s fiscal lever constrains him just as it constrained Orbán: compliance means funds, but compliance also means subordination to a procedural class with no democratic accountability for how it wields that lever. Magyar now faces the same choice every holder of extraordinary authority has faced: entrench his own power to render it ordinary, use the supermajority to build institutions that function without him and then step aside, or dance while the music lasts.
This article is an American Affairs online exclusive, published May 4, 2026.
Notes
1 Roughly half of eventual defaults would have occurred even without the currency shock, according to Gáspár and Varga (2011), as summarized in the Dancsik et al. analysis. These were borrowers whose income couldn’t service the debt even at the original exchange rate. The loans were structured so borrowers bore the entire exchange rate risk. Contracts were issued in forints but indexed to a foreign currency, and banks applied different exchange rates at disbursement and repayment, extracting a spread on every transaction. On the 70–80 percent installment increase and the distributional pattern: Bálint Dancsik et al., “Comprehensive Analysis of the Nonperforming Household Mortgage Portfolio Using Micro-Level Data,” MNB Occasional Papers Special Issue (2015), 115.
2 Hungary was the only country under the EU’s “excessive deficit procedure” continuously from accession in 2004. Annual deficits ranged from roughly 5 percent to over 9 percent of GDP between 2002 and 2006, depending on methodology (Hungarian fiscal statistics were revised multiple times across ESA95 and ESA2010 standards). Source: European Commission, “Excessive Deficit Procedure records for Hungary,” 2004–2013.
3 The Supreme Court President was removed through legislation requiring domestic judicial experience, disqualifying his seventeen years on the European Court of Human Rights. Naturally, the ECHR found this violated his rights (Baka v. Hungary, 2016). The Fourth Amendment to the Fundamental Law, adopted March 11, 2013, annulled Constitutional Court decisions made before the 2012 Fundamental Law took effect; the Council of Europe’s Venice Commission, the UN High Commissioner for Human Rights, and Human Rights Watch all objected.
4 Péter Polt resigned as Prosecutor General in May 2025, three years before his nine-year mandate would have ended, to take a seat on the Constitutional Court. Some commentators characterized the move as preemptive entrenchment of the Orbán system ahead of a possible change of power in 2026. Transparency International Hungary’s legal director Miklós Ligeti has publicly described a pattern where misconduct above department-head level rarely reaches investigation. The European Commission’s 2024 Rule of Law report noted persistent political influence over Hungary’s prosecution and “undue interference” in individual cases.
5 The easing cycle began under Matolcsy’s predecessor in August 2012, when the base rate was 7 percent; it stood at roughly 5 percent when Matolcsy took over in March 2013.
6 The MNB channeled HUF 266.4 billion (€670 million) through six “Pallas Athéné” foundations starting in 2014; the assets under management grew to nearly HUF 500 billion (€1.25 billion) managed through Optima Befektetési.
7 MNB, “The Funding for Growth Scheme has achieved its objectives,” media release, April 5, 2017. MNB estimates the program contributed “some 2 percentage points to economic growth between 2013 and 2016” and raised employment by 20,000 persons.
8 The €3–4 billion is cumulative across several rounds of intervention between 2011 and 2015: an early repayment scheme at artificially favorable exchange rates (2011), mandatory reimbursement of HUF 1 trillion in unfair fees and exchange rate spreads (2014), and the final forced forint conversion of HUF 3.6 trillion in remaining FX loans (2014–15). The mechanism throughout was unilateral contract abrogation. The government rewrote the terms of private financial agreements by decree. This signaled to foreign investors that Hungary would override contracts when politically convenient, contributing to a persistent risk premium on Hungarian assets.
9 Központi Statisztikai Hivatal [Hungarian Central Statistical Office], “Real Income—Real Wage Index,” Real Wage Index Series, table 21.1.1.35.
10 Municipalities controlled public works assignment, creating direct local patronage. These 200,000 people show up as “employed” in aggregate statistics, but the nature of the work was typically described as digging ditches, sweeping streets, raking leaves, and similar menial tasks.
11 Health spending: the 7.4 percent (2009) figure is from the OECD Health Expenditure and Financing database; the 6.5 percent (2022) figure is from OECD Health at a Glance 2023 and corroborated by the Hungary Country Health Profile 2023, which reports 7.4 percent for 2021 (a Covid-year spike) and lower figures for surrounding years. The 4,000–5,500 workforce-exit estimate for March 1, 2021, comes from Heinrich Böll Foundation reporting and Peter Gaal et al., “Hungary: Health System Review,” PubMed, 2021. Act C of 2020 on Healthcare Service Relationships is public law.
12 Not all of this decline is Orbán’s fault—doctor emigration began with EU accession in 2004, teacher aging affects all V4 countries. But Hungary’s health spending fell from 7.4 to 6.5 percent of GDP (OECD Health Expenditure series) while its peers’ spending was stable or rising, and its education spending ranks last among thirty-eight OECD countries (Education at a Glance, 2025). The gap between Hungary and its V4 peers is a policy choice, not a demographic inevitability. The €1.8 billion teacher salary program is an ESF+ allocation (European Social Fund Plus), 2024–31.
13 By February 2022, the deficit had reached half the annual target. The 2021 deficit: 7.1 percent of GDP; 2022: 6.2 percent (Eurostat general government deficit data). Note the structural parallel to the pre-Orbán Socialists: election-timed fiscal expansion creating unsustainable obligations.
14 Peak 2022–23 HICP figures per Eurostat: Hungary 5–7 percentage points above every V4 peer (Poland 18.4 percent, Czechia 17.2 percent, Slovakia 15.4 percent); this approximates the policy-attributable share after accounting for the common regional energy shock. Cumulative HICP 2015–24: Hungary 66.6 percent versus peers 47–52 percent.
15 GKI Gazdaságkutató [Economic Research Institute], “Without EU Funds, Hungary’s Economy Would Struggle to Stay Afloat,” May 2025. GKI’s macroeconomic model estimates that Hungarian GDP growth would have averaged 0.7 percent rather than 2.1 percent over 2004 to 2023 without EU transfers; in 2010, 2011, and 2013, the absence of EU funding would have meant no growth at all.
16 The €22 billion CPR freeze and the €6.3 billion Conditionality Regulation freeze partly overlap, as both affect cohesion program commitments. The combined unduplicated exposure was roughly €28 billion.
17 The European Commission released the €10.2 billion on December 13, 2023. Orbán dropped his Ukraine veto at the European Council summit on December 14-15.
18 The EU’s own institutional dynamics—how conditionality is deployed, what compliance selects for, who is empowered by the procedural requirements—are structurally analogous to the dynamics described in this essay but lie outside its scope.
19 Magyar nominated his brother-in-law as justice minister on May 1, 2026.
