Protesters poured into the streets of Budapest by the thousands the past few nights with calls for Hungary’s Prime Minister, Viktor Orban, to “reconsider it!” The policy to be reconsidered is what Hungary’s workers are calling the government’s new “slave law” requiring labor to work up to 400 mandatory hours of overtime (think: every Saturday all year at 8 hours a day), with the “promise” of pay 3 years later. Meanwhile, recent weeks saw protestors in Wisconsin marching to their capitol demanding the outgoing Republican Governor, Scott Walker (“butler” to the “black energy” oil and coal baron Koch Brothers), halt plans to restrict the powers of the new incoming Democratic governor. Changes to giveaways to big business through the Wisconsin Economic Development Corporation, among other measures, would be foreclosed, ensuring that public gravy keeps getting ladled out to business interests favored by the Republicans.
The Soviet Union always declared it was ‘dizzy with success’ on economic performance. They buried (pun intended) their critics in statistics to prove the point. Hungary’s Viktor Oban and Wisconsin’s (Hungary on the Great Lakes) Scott Walker, while not literally burying critics (both bully them), fill and filibuster media space with data declaring their economic victories justify their rule.
Closer inspection reveals the fraud of these successes. Their chief claim to taking a victory lap in Hungary and Wisconsin is full employment. Both Hungary and Wisconsin possess industrial economies supplying mid-level products to global supply chains along with a mix of legacy industries. Orban and Walker both pursued wage suppression policies in order to attract and/or grow these sectors, where windfall gains would go to business, and go unshared with labor.
In Hungary, the average salaries (gross) are kept below neighboring industrial competitors of Poland, the Czech Republic and Slovakia. Wisconsin has done the same, with weekly industrial wages behind all Midwestern states (e.g., IL, MN, OH, IA, MI, IN) and with median household annual incomes over $9000 below neighboring Democratic Party governed Minnesota’s infrastructure-led (human and physical) economic strategy.
This economic “development” strategy’s chief contradiction is it pushes labor to “vote” with their feet, as the late Albert O. Hirschman argued in his 1970 classic work on this subject. Both, Orban and Walker boast low-unemployment rates. Yet, their wage-suppression policies have both led to workers leave. Hungary’s emigration problem is well known, but few know that Wisconsin under Walker is in the top 10 states in the US that people exit. Working-age emigration both holds down unemployment rates, but eventually puts upward pressure on wages. What to do? If you are Viktor Orban, pass the “Slave Law” ensuring business has more labor hours at lower compensation, even though in the long run it pushes even more workers to move. If you are Scott Walker, bust unions (with anti-union “Right to Work” legislation) and legislate limitations on compensation increases to public workers (“Act 10,” the signature legislation suppressing public worker pay). After that, launch ad campaigns trying to attract young workers back from neighboring states your policies pushed out.
Both Orban and Walker deflected from their giveaways to industries (usually older and polluting) by ginning up rhetoric against an ‘other’ that in reality was small, if nonetheless big in the popular imagination. Orban used a megaphone strategy targeting immigrants that largely never came, but for whom imagery on television was plentiful. Meanwhile, Walker used a dog-whistle strategy targeting African-Americans, who while only a paltry 6% of Wisconsin’s population, but are the subject of nightly crime reports on television broadcasts throughout the state. Yet, this time Orban and Walker have gone too far. The “Slave Law” is unpopular throughout the country. And, Walker and Wisconsin State Assembly Speaker Robin Vos, assumed they could get away with recent measures against labor and democracy, given they “only” lost their November election due to insufficient voter suppression measures against African-Americans. This cynical assumption and the political maneuvering since, is designed in part to return Walker to office in 2022. But, it is backfiring as recent protests and polls show. And, in Hungary, Orban has clearly miscalculated in his legislation hitting labor throughout the country.
What is clear, given Orban and Walker’s recent signed legislation, is neither is ready to “reconsider it.” Yet, the people in both Hungary and Wisconsin are now thinking over their past support for Orban and Walker.
Jeffrey Sommers is Professor and Senior Fellow (Institute of World Affairs) at the University of Wisconsin-Milwaukee. Visiting Professor, Stockholm School of Economics in Riga. Co-Director of Society Networked at the Central European University.
Peter Balazs is former Foreign Minister of Hungary and Director of the Center for European Neighborhood Studies at the Central European University (Budapest).