Budget Nomad: Where There is Smoke...There May Be Corruption

Wednesday, July 10, 2013

Where There is Smoke...There May Be Corruption

There is smoke coming from Budapest and it is not a fire, but the fumes of angry citizens over probable corruption. For once, the liberal and conservative media are in agreement that there is something rotten in parliament.

In 2012, in an attempt to wipe out teenage smoking, the government decided to slice the number of licenses for retailers to sell cigarettes country-wide from 42,000 outlets, which included supermarkets and gas stations, to a mere 7,000. Now, being a reformed smoker for over 31/2 years, I don’t much care what they do. Actually, it cuts down on the numbers of smokers blocking the sidewalks outside cafés, restaurants, and other businesses, I am thrilled. It may make negotiating the sidewalk less like a game of Pac Man.

From the cut and burn of licenses, businesses had to reapply for a license to sell tobacco. What quickly became apparent was that these authorizations were going to those who had close ties to the ruling right-wing party Fidesz party. As things unfolded, it seemed that many had no prior experience in running a business. Some were even family members of the politicians while others were Continental cigarette manufacturer employees. An upper level executive of Continental is a friend of Orban’s chief of staff, who happened to initially author the legislation.

Wikileaks was not needed here when there was a leak from the Fidesz gang. It included the instructions for the bidding process for the certificates to sell, which included "just as long as the (opposition) Socialists don't win any".

Tobacconist protesters are stating that of the 5,145 former concessions that were once licensed, only 60 have received the bid throughout Hungary. One such protester has stated that he has been selling cigarettes since the 90s and to stop now would not allow him to cover expenses for his business. Being on in years, he has no other employment opportunities.

After all the bidding had become a done deal, they added several amendments to the legislation. Included was a mighty profitable sales margin of 10 percent. Furthermore, shops may also sell ice cream, drinks, newspapers, and give out small loans. The original law was to sell cigarettes only.

Our next door neighbor, the dog groomer, was ousted from her rental to make way for a National Tobacco store. My private little thrill was to pass her place on a frequent basis to catch a voyeuristic glimpse of the dogs she was grooming. Now, the view is cigarettes.