Welcome to American Diplomat. What actually happened? This is Dan Rosenblum. And this is Laura Bennett. And today we are very fortunate to have as our guest David Kostolomczyk. David is currently a senior fellow at the Center for European Policy Analysis, but before that for decades was a career foreign service officer. We spent over 20 years in various overseas postings, Russia, Albania, Turkey, NATO, and especially relevant and interesting to us today for our conversation, served as deputy chief of mission and for a long period of time, the charge d'affaires running the U.S. embassy in Budapest, Hungary. American Diplomat is a project of Arizona State University's Leadership, Diplomacy, and National Security Lab, led by senior former diplomatic and national security professionals, and providing character-driven leadership, diplomacy, and national security education and training. Thank you also to the American Academy of Diplomacy and the American Foreign Service Association for their support. And welcome, Dave. We're so happy you're here today. Thanks for having me. All right. So how shall we begin, Dan? We want to take advantage of Dave's experience and knowledge of Hungary to understand how it happened that a country that had been a leader in democracy in Central Europe became essentially an authoritarian system. We want to just understand better how Orban did it. Well, thanks again for the opportunity to be here, and I'm happy to talk about that. The process started almost immediately after Orban won his first two-thirds majority in 2010, which marked his second term as prime minister. He took advantage of that two-thirds majority in the parliament to change the constitution, and then on the basis of a new changed constitution, begin to put in place all the mechanisms which would ultimately allow him to perpetuate his control of government in Hungary for the next 16 years. That included changing the judiciary, reducing its independence, reducing the retirement age most immediately at first from 70 to 62, which forced out a number of judges who had been on the courts for some time, allowing him to stack the courts with his supporters. It allowed him to change the structure by which representatives were elected in Hungary to a hybrid single district system combined with a proportional system. So there are single mandate districts throughout the country, 101 of those. And then there's voting done on the basis of how each party does nationally and the percentage of votes that it collects. That system, that change in system, allowed Orban to, for example, in 2014, with only 45% of the national vote, to retain two-thirds of the seats in the parliament and to continue his quest to remake and change the government to better suit his political needs. So it was a little like gerrymandering. It was most certainly gerrymandering. And so that played a great role in cementing and putting in place sort of a more formidable system for the opposition to overcome in trying to unseat Orban or to at least to wrest from Fidesz's control, two-thirds majority of the seats in the parliament. There were other things that happened along the way, just as I was preparing to arrive in Hungary in 2016. And you got there in 2016, right? 2016. The refugee crisis of 2015, tens of thousands, hundreds of thousands, millions of refugees coming from Syria and elsewhere across Turkey and then into Europe looking for a better life. Orban took great advantage of this. He staked out Hungary's opposition to allowing refugees to remain in Hungary, even as they sought political or other asylum status in other European countries. There was a large wall, fence actually, constructed along the southern border of Hungary with Serbia, which then compelled refugees to take different course in trying to get to their, in many cases, their ultimate destination, being Germany or other countries in Central or Western Europe. And this gave Orban a great opportunity to rail against Brussels, which was encouraging European Union countries to exercise some compassion, some restraint with regard to the refugees. Orban used that to demonstrate his opposition, his independence from dictates from Brussels, and then to begin to work in a narrative which he used very effectively throughout 2016, and into the national elections of 2018 against George Soros. Oh, yeah. Who Orban claimed was promoting this mass migration into Europe. Soros denied any of this, but Soros being one of the most famous Hungarians who had left Hungary decades before, become quite wealthy, and after the fall of communism in Hungary and throughout Europe, had supported civil society, had supported opposition parties, had supported educational programs to strengthen and deepen the ties between Central Europe and the rest of Europe, the United States. Orban, who himself had been a beneficiary of Soros's own programs in the United States at one point, had turned against Soros and had made him out to be the boogeyman. So Orban was actually a scholarship recipient from Soros to study in the United States. Yes, he was. Yeah. Not very grateful, apparently. No, they diverged in their political perspectives at a certain point. And by certainly the national elections of 2018, for which I was there and was serving as a charge d'affaires, Soros was branded as public enemy number one. You could not turn around in Budapest or any city or any village, for that matter, throughout Hungary and not see a portrait or a poster of Soros designated as public enemy number one. So there would be like a picture of him on the side of a building and it would say like enemy of the people or something? Well the slogan that was used at the time was and this was the pictures of Soros together sometimes with European Union leaders together sometimes with opposition party figures from Hungary all kind of juxtaposed in a poster on buildings on bus stops everywhere around the country that said don let them have the last laugh They are laughing at you because they are exploiting you and I will stand against that And so it was used effectively, and Soros was made to bear the brunt of this. And another factor which contributed to the staying power of Viktor Orban, certainly in 2018 and 2022, was the fact that the opposition in Hungary was not incredibly organized. In fact, it was quite fractured. And they couldn't unite behind a single candidate, for example. They could not. And that split the votes in opposition and gave an advantage to Orban. So speaking of Soros, one of the projects that he supported and was establishing a university called, I think, Central European University in Budapest. Tell us a little bit about how that university was affected by this anti-Soros campaign and how that reflected on the larger effort by Orban to kind of take over all the key institutions of Hungary. Yeah. Yeah. The campaign targeting Central European University, which had been established in 1991 with a very large grant from George Soros. and the programs that it cultivated over 25 years until 2016, 2017, were really world-class. Democracy promotion, human rights, and the scholarship that Central European University came to represent was really amongst the best in Europe. That did not sit well. By the spring of 2017, the government took steps to interfere with the academic freedom, with the curriculum, with the functioning of Central European University. The United States was in a unique position by this time. President Trump had been inaugurated in January, and I think the Orban government at the time assumed that the Trump administration would be supportive of their attempts to restrict the activities of Central European University. And in fact, I heard that on any number of occasions from Hungarian government officials. However, they neglected the fact that Central European University was accredited in the United States. It had enormous support in the Congress. Bipartisan, presumably. Bipartisan. So this was with the support of the Trump administration, this position on Central European University was fully supported. Yes, they did. How did they react? They were a bit surprised. Your president is not a fan of Mr. Soros, an element where I got a little more pushback from Hungarian government officials concerned the state of media in Hungary. So by the time I had arrived, efforts were already underway by the Orban government to begin to infringe upon the independence of media in Hungary and to consolidate media assets in the hands of the government or of Orban business and party supporters in a way that would allow the government, Fidesz, Mr. Orban, to control the messaging that reached Hungarian citizens. This, which, again, caught the attention of people in Washington because an independent media was considered an essential element to a functioning democracy, and the fact that the ability of opposition parties to get their messages across through television, radio, print media in Hungary was steadily being chipped away at and eroded, had people's concern. So the position of Trump, one, was very different than what we see today. Their position was we still support democracies globally. Yes. And that didn't always sit well with Hungarian government officials. There was a backlash. There was definite backlash. But we paired that at the same time with, especially thanks to the first Trump administration, an interest in accentuating business ties, defense cooperation, civil society engagement. And so it was a positive balance between concern for the health of democracy and concern for the tangible, everyday aspects of the bilateral relationship. So, David, you arrive in Hungary as deputy chief of mission in 2016. Not long afterwards, the ambassador who had been there under the Obama administration leaves post when the Trump administration comes in. Yes. You are charge d'affaires for a long period, for at least like 18 months to longer. And then there's a Trump-appointed ambassador who arrives. Tell us a little bit about who that person was. Sure. And also, I'm interested in to what degree his ideas about Hungary and our policy coincided with what you were already doing as Chargé, or to what extent they might have diverged. Yeah, did it put you in a bad position to be having to change policy or do two different kinds of policy at once? Well, the gentleman who arrived as ambassador was David Kornstein, who was a very long-standing friend of President Trump. He had been a very successful businessman in New York, had known President Trump from there. For like 30 years or something. Yes. Had himself dabbled in New York City politics, had run for mayor at one point. He was a lovely man. We began working together closely long before he arrived in Budapest. And when he arrived, we worked very, very closely together. I was very happy to see that when he arrived, he outlined a number of his early priorities. And those priorities coincided with what we had been advocating for from the embassy. the independence and the continued existence of Central European University, which was, I think, not what the Orban government expected to hear immediately from him, but he supported that. He also, as we had been doing for a good deal of time, had been advocating for Hungary to become less dependent on Russian energy sources And the ambassador focused on that like a laser And the ambassador by virtue of his close relationship with Donald Trump was someone whose arrival was greatly anticipated in Budapest. He immediately developed a very good relationship with Viktor Orban. The fact that there was now a Senate-confirmed ambassador with the ties to the president was very important for Orban, and it was an opportunity for the ambassador to deepen discussion and dialogue with the head of the Hungarian government. So help me understand, we've got Orban, we know how he liked to govern, and he was excited about Trump because he thought he would see a kindred spirit. And then was he disappointed or confused or tolerant of this ambiguity? Again, I think in the early tenure of the ambassador, the Hungarian government saw opportunity here for closer contact with the United States, certainly engagement directly with the White House. Orban had been hopeful for some time in having a White House visit, and Ambassador Quernstein set about using his influence and connections in Washington to arrange for such, which finally took place in May of 2019. But in the meantime, as I mentioned before, we continued to expand the contacts between the administration and the Orban government. We had the first visit by a cabinet official to Hungary. Rick Perry, the Secretary of Energy, visited, and then Secretary of State Pompeo made the first sec-state visit to Hungary in more than eight years. But in addition to the government meetings, foreign ministry, defense ministry, prime minister's office, etc., Secretary Pompeo sat down and spent an extensive period of time with Hungarian civil society, with representatives of the beleaguered independent media, NGOs, anti-corruption organizations. And did Secretary Pompeo and also Secretary Perry, who you mentioned, the Secretary of Energy, press the Hungarian government on energy dependence on Russia and ties with Russia in general? Was that an issue that came up? Those were topics that were addressed. One of the other matters that was of great concern to the Trump administration at that time and which was important for us in Budapest was China and the growing influence of Chinese telecommunications infrastructure in Europe, particularly with NATO allies. Huawei had established its Central European headquarters in Budapest, was on the verge of providing sensitive technologies to the Hungarians. And that was of great concern. Why? Because those technologies could be exploited by the Chinese to obtain information from a NATO ally about sensitive discussions. And that was an issue of great importance for the Trump administration at the time. So were you able to oust Huawei? No. As they say in politics, you know, you can't beat somebody with nobody. And so there needed to be an alternative. There really wasn't a Western alternative, although that began to change. And my understanding is the dominance of Huawei in Hungary has been reduced. In terms of the coming back to the question of Russian influence and the Russian role in Hungary, obviously, this would have been a concern at that time of the first Trump administration, or at least Secretary Pompeo, I'm sure, focused on that. In your time there, including after Ambassador Kornstein came, how did that Russian influence manifest itself? And were there particular points at which you confronted the Hungarians about Russia's role? There was one particular incident that was of the greatest concern, and that involved the relocation of a Russian investment bank, a bank which had been established during the days of the communist centralized market, which was dominated, of course, by the Soviet Union. Right. And this goes back to the days before the Berlin Wall fell, even like the Comic-Con. Exactly. That organization, that bank in 2017, 2018, 2019, continued to exist in Russia with the participation of a few countries, but they weren't really very active except for Hungary, which had greater funds. And at one point, Mr. Orban invited Mr. Putin to relocate the bank from Moscow to Budapest. That immediately set off concerns for people in Washington. And it set off even greater concerns for us in Budapest because the facility that was initially identified as the location for this bank was located across the square from the American embassy. This bank, it was the considered view of the United States and I would dare say all of our NATO allies, except Hungary, that this was an institution the Russians used for spying. And to have it located across the square from the American embassy was absolutely intolerable, unacceptable. It was like wheeling the Trojan horse right across the street from the embassy. So we opposed that very much. And the Hungarian government at first denied that the bank was going to be anything other than a legitimate business institution. They eventually backed off of supporting the locating of the bank across from the American embassy. But they continued to insist that it would relocate to Budapest, and the 100 or so Russian staff should have rights and privileges, which would enable them to move about and probably undertake activities not in keeping with their status. as we say. And this was something... And you confronted the Hungarian government on this issue. We did. I and some of my NATO colleagues confronted officials on this. But the person who gave it even more attention and focus was Ambassador Kornstein, who was incensed that this bank would be relocating to Budapest. And in a very loud meeting, the ambassador lost his cool and exploded at the deputy minister and stormed out of the meeting. Saying you cannot have this bank across the square or saying You cannot have this You should not have this bank in Budapest at all Everyone knows that this is not a legitimate commercial institution And we know what this organization and the people there are going to be doing. And this is outrageous. And he stormed out. I was startled by it. I know the deputy foreign minister was startled, but it underscored how seriously he and the Trump administration took this matter. Ultimately, the bank did set up shop in Budapest, and it survived another couple of years. It really served no legitimate economic purpose. and a few years ago it folded its tent and it no longer is there. Right. So Ambassador Kornstein's storming out served its purpose in terms of sending a very strong message and ultimately at least it was not located across from the embassy. So you departed post in the summer of 2019. I know that you followed events in Hungary after your departure very closely and I just wondered obviously the events of the last few weeks have been followed closely by the whole world and many here in the United States, the victory of Peter Bagyar in the election and Orban's defeat, which I guess many people didn't see coming. How do you explain it? A basic factor that played a significant role in this was the economy. The Hungarian economy has been in stagnation, if not moderate decline, over the last four years. And that's as a result of loss of confidence by investors, economic mismanagement, corruption. This has really soured Hungarians on Orban and on Fidesz. The pedophile scandal in Hungary, which outraged Hungarians and led to the rise of Peter Madjar as someone from inside the Fidesz-Urban establishment, but who represented the complete disgust with the direction that Hungary had gone, the corruption, pardoning of individuals for horrific crimes. together with loss of international confidence, propelled Madhyar. And he, unlike previous candidates in other elections, was incredibly disciplined, united the opposition around him, and avoided being drawn into culture war or other discussions that Orban government desperately wanted to drag Madhyar into. And Madhyar's singular message of Hungary can do better than this. We will clean this up. Our dignity will be restored and democracy will be rejuvenated through independent media, through an independent judiciary, through fighting corruption, promoting academic freedom, all of that resonated with Hungarians. And I'm very, very happy to see that. And I think they have a bright future. David, thank you so much for spending time with us today and giving us your insights into the phenomenon of Viktor Orban. It was particularly interesting for me to hear what was going on during that first Trump administration, which was in many ways in contrast to what we've seen in the second with respect to Hungary. But again, we appreciate your time very much. And let's hope that this result that we saw in Hungary a few weeks ago is something that will perhaps be an inspiration to people who are struggling against creeping authoritarianism around the world. Thank you. Thanks for having me. American Diplomat is a project of Arizona State University's Leadership, Diplomacy, and National Security Lab, led by senior former diplomatic and national security professionals and providing character-driven leadership, diplomacy, and national security education and training. 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