In June, a definite change of political strategy became apparent in the behaviour of the government party: the 'catch all' concept of a year ago is being gradually changed to a more decidedly right-wing, conservative political strategy.
In 2010, Fidesz won the election by what is known as a 'catch all' approach: the party tried to promise something to virtually all segments of Hungarian society. This approach seemed rational back then: the popularity of the Socialist government was so low that it was feasible to 'unite' the majority of the population under the Fidesz-banner. This 'catch all' strategy became less and less sustainable, for two main reasons. On the one hand, Fidesz used up its political capital in the organisational institutional and constitutional changes: the party attempted to transfer the wide support it enjoyed for the long-term stabilisation of its political - and institutional - position. This in turn made a 'catch all' approach self-defeating: the party simply ceased to enjoy wide support in every relevant socio-demographic group. In addition, attempting to please everyone was no longer possible because of policy implications: the economic targets of the government could not be reached without policy corrections - i.e. austerity measures.
There are three main characteristics of the new, more focused and more politically conservative approach of Fidesz. The first is the desire to fundamentally change - reform - the economic and social spheres. The second is the conviction of the party that this fundamental change is hindered by vested socio-economic interests that need to be defeated. The third is the notion that the key to the success of the government is improving economic conditions resulting in a more significant room to manoeuvre.
The change of approach is most visible in economic policy. A year ago, Fidesz focused on creating a 'work-centred' economy, which, in Fidesz-jargon meant that the key priority of the government was raising the employment rate. In opposition, Fidesz talked about creating 1 million new jobs. However, in the spring, and especially in May and June, the new focus became the tackling of the deficit. Making deficit-reduction the key economic priority has a number of consequences. First of all, it does not by itself contribute to more growth. Additionally, it does not reduce - might even increase - unemployment. And third, the savings generated by a lower deficit are realised not by the taxpayers but by the central government (provided tax rates stay the same). Thus, this change of priorities can be better explained by political than by economic reasons: the most important consequence seems to be the availability of discretionary funds to the government by the end of its term.
As a result of the Party Congress of the Socialists - tasked with discussing the internal affairs of the party - the position of Ferenc Gyurcsány took a turn for the worse. However, it also became apparent that the ex-prime minister has no intention of giving up after any defeat. This means that there is no plausible scenario as to how the infighting of MSZP could stop. We therefore predict that the present situation will last at least until the next intra-party elections. Despite decreasing popularity, Gyurcsány will not seize to attack the present leadership of the party but knows that founding a new party would put him in a very disadvantageous position when it comes to infrastructure and organisation. Still, MSZP is in a better position than appearances suggest: the party has at least as much of a chance of forming a government in 2014 as Fidesz had in 1995 to win the next election.