Corruption is a feature, not a bug

Demographers don’t get the point of buying 7-seated cars for families.

Orbán’s demography-excused big state spending bonanza includes a curious little element, a 7000 euro handout to families with 3+ children to buy big cars. Silly demographers think the program is really about demography and beg to respectfully differ.

But it is not about more babies. It is about the car industry – and Hungary’s dangerous exposure to it.

At his 2019 state of the nation revelation speech King Orbán tried to transform himself from warrior king to fatherly father of the nation and set down to the peacetime task of breeding his nation. The right ones, of course, like every good breeder.

He declared the extension of the loan-for-babies mortgage program promising tens of millions in exchange for new ethnic Hungarian babies into traditional, divorce-free families, making authoritarian underdogs wet with anticipation and relieved from being told how to live.

He also announced a curious little measure, that big families would get up to 2.5 million forints (approximately 7000 euros) to help buy a 7-seated car.

This curious specificity of regulations begs for an explanation. On the surface, it appears to be an instance of micromanagement based on a hunch. Indeed, the state secretary for demography has opined that it was the size of the car that made couples stop at three children and if only they had bigger cars, they would fill them up with more. Creating policies based on such hunches (as opposed to evidence) would be bad enough. But that’s not it.

But that didn’t stop the professional demography experts and economists (paid by the central bank no less) from releasing a cute little book on how to do demography – now that no one was interested and the government made a deafeningly loud and expensive policy package without asking them.

In this little book said demography enthusiasts appear to labor under the misapprehension that the measures of Orbán’s ‘family protection action plan” are really about breeding the Huns. So they evaluate those measures based on their expected success (nil) and respectfully suggest changes that would actually breed the livestock harder. (Curious state of mind, being a demographer…)

“If we give seven-seated cars to families, it will not make a single baby born, that’s for sure…”

But Orbán is not interested in evidence-based policies. If the Huns will get bred that’s a happy side effect (and in his head he will call them all Viktor). But the policy is not meant to happify or even to multiply livestock. It was meant to 1) solidify Orbán’s grasp on power and cement him in the pose as the Father Of The Nation Who Really Totally Gives Gives Gives (never mind that he takes that money from your own pocket in the fisrt place) and 2) to serve cronyist interests.

Communication and corruption. That’s the only two things politics had been reduced to (not just under Orbán).

The first goal is obviously served as livestock trapped on the skyrocketing housing market that grew out of their reach since 2013 is lining up pledging babies by the tens of thousands to get a loan to buy (billion conditions apply) – and will blame themselves when their marriages don’t work or any other vis maior gets in the way of their baby-pledge and the loans come to repayment with penalty.

But the second goal of Orbán is also well serves as the crony-infested construction sector is unloading the newly built developments at the frenzied applicants in the meantime – so they are also fed. But so are the carmakers that account for a whopping one fifth of the Hungarian economy. That’s 20%. Of the GDP. Not someone’s money, but the hypothetical sum of all transactions in the country in a year.

Given that the subsidy can only be used for brand new cars we can start getting a picture of what the underlying motivation for the law actually was. Someone who had been following the spectacular and hard-to-justify car procurements of various government agencies in the last couple of years and didn’t fall for the superficial explanation of blaming it on vanity and waste, could easily connect the dots and recognize a gesture to carmakers. This policy, along with the boost to the loans-for-babies program is designed to benefits certain industries – and perhaps even certain players. To underline that point, the state secretary responsible for the “family protection action plan” had guaranteed the continuation of the car loan program until the end of 2022, the next election year, and thanked the participating carmakers.

Subsidizing car purchases because it may or may not stimulate the birth canals of mammals is a stupid excuse for the handout. But the people are buying it. And even the demographers, who even wrote a little paper arguing that it is not how birth-stimulation works in other countries. No kidding, academics…

The morons also suggested another ministry to stimulate births and other central planning tools – old instincts die hard – so I’m not particularly sorry for them. Especially since they were very well paid for their opinionating and some of them may be singled out to spearhead phase two of the breeding program. It is promised to speed up next year, with even more spending and even more power to bureaucrats – and less chance for the unruly non-breeding elements.

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Featured image: D.L.

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