July 13, 2012
In January 2011, the government of Hungarian Prime Minister Viktor Orban announced that the 82-year-old philosopher Agnes Heller and four other academics would be investigated for the misuse of nearly $2.5 million in public grant money. The same day, the country’s leading conservative newspaper, Magyar Nemzet – a supporter of Orban — published a bracing attack on the professors. Other right-wing publications and television channels followed suit, derisively referring to the “Heller gang” which had “researched away” government money. The investigation, such as it was, lasted for nearly two months before being quietly put to bed with no evidence of wrongdoing.
Agnes Heller did not strike me as the sort of woman who would pose a threat to Orban when I visited her small, messy flat in a Budapest apartment overlooking the Danube River in February. She is about four feet tall and seems more like a doting Jewish grandmother than a corrupt political functionary. After surviving the Holocaust, and thus avoiding the fate of some 450,000 of her fellow Hungarian Jews, Heller studied under the renowned Marxist philosopher Gyorgy Lukacs at the University of Budapest. Heavily influenced by Lukacs’ critique of Stalinism (he had served briefly as a minister in the revolutionary government of Imry Nagy which was violently put down by the Soviets in 1956), she eventually became an outspoken opponent of Hungary’s communist regime and was forced into exile in 1977. Now, she mainly spends her days overseeing graduate students and enjoying semi-retirement. “I have not picked up one single penny,” Heller told me when I asked her about the allegation that she had stolen government money.
To some in Hungary, the attack on Heller and her colleagues reflected a coordinated campaign against Orban’s most outspoken critics. Heller has publically chided Orban for what she terms his “dictatorial inclinations” and testified against his policies at the European Parliament. “It was so well orchestrated, it doesn’t happen by accident,” Gabor Horvath, an editor for the daily Népszabadság, told me about the investigation and the accompanying media attacks. “This is character assassination.”
The assault on the philosophers is just one example of the disturbing turn away from free and open democracy in Hungary that has taken place since Orban came to power in April of 2010. A day before the government announced its investigation of Heller, some 60 European luminaries, including the late Vaclav Havel, published an open letter decrying the state of affairs. “Hungary’s government,” the letter warned, “is misusing its legislative majority to methodically dismantle democracy’s checks and balances, to remove constitutional constraints, and to subordinate to the will of the ruling party all branches of power, independent institutions, and the media.”
Greece’s economic peril has raised fears about the end of the eurozone. But Hungary presents as much of a fundamental challenge to the European Union, just more a political than an economic one. Hungary today is the first member state of the EU, a body that prides itself as the embodiment of classical liberal values, to tack sharply toward autocracy. Supporters of the EU often claim that it has the power to nudge the nations in Europe’s periphery toward democracy. But the EU has never been confronted with this level of democratic backsliding from one of its own members. Indeed, were present-day Hungary to apply for EU membership now, it would not likely be admitted. The fate of the country over the next several years will test the foundational principles of the entire European project.
Of all the nations in the Soviet sphere, Hungary, it seemed, should have made the smoothest transition to liberal democracy. Beginning in the 1960s, Communist Party leader Janos Kadar governed by what became known as “Goulash communism,” mixing market principles and limited personal freedoms with authoritarian state control. Under Kadar, Hungary became more liberal than any of the other Soviet Bloc regimes in Central and Eastern Europe, earning the moniker, “the happiest barrack.” It was the Hungarian government’s decision in May 1989 to remove its border fence with Austria which precipitated the fall of the Berlin Wall five months later.
Orban was among the dissidents who opened Hungary to the West. In 1988, as a 25-year-old law student, he founded Fidesz (an acronym for “Alliance of Young Democrats”) with a group of his classmates. Fidesz, a liberal party in the Western model, called for Hungary to adopt a market economy and a firm orientation towards Europe. The following year, Orban delivered a speech in Budapest’s iconic Heroes’ Square calling for the removal of Soviet troops from his country — the first dissident in the Eastern Bloc to make such a demand.
In the mid-1990s, however, the party moved right. Peter Molnar, a classmate of Orban’s and a co-founder of Fidesz, told me that the shift was a cynical electoral strategy. By the time of Hungary’s second national election in 1994, the then-ruling conservative Hungarian Democratic Forum (MDF) collapsed. Suddenly, a gap opened on the nationalist right, long a large constituency in Hungary. “I remember sitting in a parliamentary group leaders’ meeting when someone argued that there is a free space, an opening up of space on the center-right,” Molnar recalls. “‘We should move there,’” this person suggested. “Some of us were shocked of course because we did not think that we belonged to that place, and more important, we of course thought that we don’t choose our politics by where there is ‘space,’” Molnar said. He was in the minority, however, and under Orban’s leadership, Fidesz soon shifted to the space once occupied by the MDF and cancelled its membership in the Liberal International. In 1998, the party gained control of parliament and Orban became prime minister, serving until 2002.
Orban has dominated Fidesz since its creation. “People who surround him certainly have this type of admiration, that he’s a sacred figure,” Endre Bojtar, editor of the liberal weekly Magyar Narancs, told me. This admiration used to be more widespread; Western officials involved in Eastern Europe’s post-communist transitions saw him as a favored son. “He was a major democrat,” Mark Palmer, the American ambassador to Hungary during the last year of communist rule, said in an interview, “someone who, in my own mind, was as clear-headed about what Hungary needed and as European-oriented as anyone and courageous as anyone.” But now, Palmer concedes, Orban has changed. “Even the best of us can be corrupted by power. And that’s what I really think is what’s happened.”
In April 2010, Fidesz returned to power after defeating Hungary’s socialist party in national elections. Although it won only 53 percent of the vote, due to the particularities of Hungary’s electoral system, it gained a two-thirds majority in the single-chamber house along with a small Christian Democrat party. Almost immediately, the coalition pushed through a raft of controversial reforms…
July 13, 2012
For the last several years, dating back to the Iraq War’s low point, it has been the vogue to speak of “nation-building at home.” It is intended as a pun: usually when we talk about “nation-building” we mean the work of establishing in other countries the institutions and values necessary for political stability. Those who speak of “nation-building at home” imply that the cost of overseas interventions has left the United States in a condition of disrepair. They suggest that money being spent abroad would be better spent on domestic projects, including on a more literal kind of nation-building — the construction and repair of roads, railroads, bridges, dams, pipelines, and the other elements of infrastructure.
The question of infrastructure (or “internal improvements,” or “public works”) has bedeviled the nation since its founding. Problems of infrastructure policy drove George Washington, James Madison, and others to form our constitutional system of government — nation-building in the truest sense. In the antebellum era, a young John C. Calhoun urged his fellow congressmen to “bind the Republic together with a perfect system of roads and canals.” In the early industrial euphoria, railroads broke the states and then rebuilt the nation. In the darkest hours of the Depression, FDR designed a public-works program “to put more men back to work, both directly on the public works themselves, and indirectly in the industries supplying the materials for these public works,” because “no country, however rich, can afford the waste of its human resources.” Twenty years later, amid postwar peace and prosperity, Eisenhower urged that “a modern, efficient highway system is essential to meet the needs of our growing population, our expanding economy, and our national security.”
In this, as in all things, history rhymes: where Franklin Roosevelt promised in a fireside chat that Americans would “see the dirt fly,” Barack Obama, prior to his inauguration, promised Americans“shovel-ready projects all across the country.” But even beyond rhetorical echoes, infrastructure is and always has been seen as both a key to national prosperity and a font of national woe. It will “strengthen and perpetuate” the Union; it will bring us the pork barrel and “bridges to nowhere.” It will make us rich; it will cost us a fortune. It is the path to progress; it will ruin the environment.
One recent pair of events illustrates perfectly the nation’s Janus-faced view of infrastructure. On August 31, 2011, President Obama issued a memorandum for the heads of executive departments, opening with strongly pro-infrastructure language:
To maintain our Nation’s competitive edge, we must ensure that the United States has fast, reliable ways to move people, goods, energy, and information. In a global economy, where businesses are making investment choices between countries, we will compete for the world’s investments based in part on the quality of our infrastructure.
Investing in the Nation’s infrastructure brings both immediate and long-term economic benefits — benefits that can accrue not only where the infrastructure is located, but also to communities all across the country. And at a time when job growth must be a top priority, well-targeted investment in infrastructure can be an engine of job creation and economic growth.
To that end, the president urged, “it is critical that agencies take steps to expedite permitting and [environmental] review.” Yet at the very moment that the Obama administration issued that memorandum, it was also delaying action on the most prominent infrastructure proposal in recent memory — the Keystone XL project, a proposed 1,700-mile pipeline that would carry up to 830,000 barrels per day of Canadian crude oil to U.S. markets. Though the State Department had completed a review and found that the project would have no undue environmental impacts, activists disputed those findings. The administration initially announced it would delay its approval decision until 2013 while it re-reviewed the project. When Congress then legislated that a decision be made within sixty days, the administration deemed that amount of time “insufficient for such a determination,” and denied the permit outright. Whatever the merits of Keystone XL, the White House’s attempt to delay decision on such a major project cast doubt on the sincerity of its call for urgency — and it illustrated how readily infrastructure decisions become enmeshed in broader political debates.
The Keystone XL episode came amidst the latest cycle in Washington’s debate over infrastructure policy — a debate rekindled in large part by the 2009 Report Card for America’s Infrastructure released by the American Society of Civil Engineers (ASCE). Surveying the nation’s bridges, highways, dams, and levees, ASCE concluded that “years of delayed maintenance and lack of modernization have left Americans with an outdated and failing infrastructure that cannot meet our needs.” In a report replete with facts and figures, one number stood out: $2.2 trillion. That would be the cost, in ASCE’s estimation, of rehabilitating our infrastructure to “good condition” within five years.
Of course, asking civil engineers whether America needs to invest in infrastructure is like asking a barber whether you need a haircut. Still, ASCE’s conclusions resonate with an American public that has witnessed in recent years an astonishing series of catastrophic infrastructure failures, including the Minneapolis I-35W bridge collapse in 2007, the failure of the levees in New Orleans after Hurricane Katrina in 2005, and the Northeast blackout of 2003 Even when our infrastructure manages not to fall apart completely, all too often it is worked far beyond its designed capacities. Consider the nation’s airports, for example: in 2009, 21 percent of domestic flight arrivals were delayed, canceled, or diverted, and the average delay was 54 minutes. Even if the Federal Aviation Administration succeeds in implementing its long-called-for multi-billion-dollar “NextGen” flight management system, and also carries out its plan to build or expand runways at the nation’s thirty-five busiest airports, the agency’s own analysis indicates that another fourteen airports will still lack sufficient runway capacity…
July 13, 2012
PRESIDENT OBAMA’S pivot to East Asia is well-timed. The geostrategic importance of the Middle East is vastly overblown. The region matters to the United States chiefly because of its influence in the world oil market, but that influence has been in terminal decline for a generation, a fact almost wholly unnoticed by outside observers. A confluence of developments—including rising prices and production costs, declining reserves, and the availability of alternate fuels and unconventional sources of oil—will decisively undermine the defining role of the Middle East in the global energy market. Meanwhile, the United States has vital interests at stake elsewhere in the world at least as pressing, if not more so, than its interests in the Middle East. These include thwarting the proliferation of weapons of mass destruction, fighting transnational terrorism and maintaining stability in key strategic locations of the world.
For centuries prior to World War II, the Middle East was considered strategically irrelevant. Alexander the Great marched across the impoverished Arabian Peninsula only because it lay between him and his goal: the fabled wealth of Persia and India. The region was merely an expanse to be crossed for traders on the Silk Road between Europe and China in the Middle Ages. The great empires of modern Europe turned to every other region in the world, including Africa, before colonizing the Middle East late in the age of empire because the vast desert appeared to be of little use to them. The British occupied Egypt in the nineteenth century and invested in the Suez Canal not because of anything Egypt had to offer but because it was the fastest way to get to India.
The contemporary strategic importance of the Middle East stems from its comparative advantage in producing oil, a commodity vital to the modern world economy. This comparative advantage is based on four factors. First, Middle Eastern oil is the cheapest in the world to produce because of simple geology. Middle Eastern oil lies under flat desert, not under an ocean or in the Amazonian river basin. In 2008, producing a barrel of oil cost between $6 and $28 in the Middle East and North Africa, compared to up to $39 elsewhere in the world and up to $113 per barrel of oil shale.
Second, most Middle Eastern oil is a superior product. The chemical properties of Middle Eastern “light sweet” crude oil make it easier and cheaper to refine than the “heavy” crude of Venezuela, for example. Third, Middle Eastern oil developers benefit from economies of scale because the cheap oil there is so plentiful. Even today, the region is still home to more than half the world’s proven, commercially viable conventional oil reserves and a third of world oil production. Fourth, the Middle East’s dominance of oil production and reserves makes it “too big to fail,” which effectively lowers producers’ risks. Buyers believe, with justification, that neither the governments in the region nor the developed world would allow a significant disruption to oil production (especially after the embargoes in the 1970s backfired).
This comparative advantage translates into global power and influence because of the modern world economy’s high demand for oil. Oil was used for lighting and lubrication long before the industrial era, but the modern market for oil started in 1886, when Karl Benz invented a machine for automated mobility powered by an internal-combustion engine fueled by refined petroleum. In a remarkably short time, the world abruptly ceased using steam, coal and animals to power the transport of people and goods, transitioning almost entirely to petroleum products. One hundred twenty-five years after Benz patented the automobile, Americans consumed thirty-six quadrillion BTUs of energy from petroleum. This provided 94 percent of their transportation-energy needs and 40 percent of their industrial-energy consumption; it also accounted for more than a third of the nation’s entire energy demand. The United States’ experience has been mirrored in countries across the globe. Global transportation—by car, truck, airplane, bus, motorcycle, boat and even some trains—is overwhelmingly powered by fuels derived from oil.
THESE TWO factors—the Middle East’s comparative advantage in oil production and the world economy’s need for oil to power transport—made the modern Middle East what it is today. The region would not be as strategically important otherwise.
But the Middle East’s comparative advantage in energy production and the world’s need for oil both peaked around 1974, and both have been in long-term decline ever since. In reaction to the oil embargoes and disruptions of 1974 and 1979, the Western world embarked on a generational and largely successful effort at energy conservation. The United States’ energy intensity—a measure of how much energy is used per dollar of GDP—has been cut in half since 1973, falling from 15,400 BTUs per dollar to 7,470 in 2010, according to the U.S. Energy Information Administration. This unheralded success means that because of advances in efficiency and conservation practices, the world economy is less dependent on all forms of energy, oil included, than previously. Additionally, the world’s energy needs are being met by an ever-expanding menu of inputs, including nuclear power and renewable sources. In 2010, petroleum’s share of America’s energy sources was the lowest it had been since 1951. The world economy’s oil intensity, or “the amount of oil needed to produce one dollar of GDP,” in the words of the International Energy Agency (IEA), “has fallen steadily over the last three decades.” That is not the whole story: “The decline has accelerated since 2004, mainly as a result of higher oil prices, which have encouraged conservation, more efficient oil use and switching to other fuels.” The introduction of electric and hybrid cars in recent years, while still in its infancy, promises to accelerate the decline in demand for petroleum-based fuels…
July 13, 2012
This image has been posted with express written permission. This cartoon was originally published at Town Hall.