The 3rd in the row annual conference on The Role of State in Varieties of Capitalism (SVOC) was held for two days in Budapest, from 30 November to 1 December 2017. Organised on behalf of the Institute of World Economics of the Hungarian Academy of Sciences and of Central European University, it focuses on the effects state regulation under the conditions of capitalism around the world and explore its political economic implications. The 2017 Conference aimed particularly at New global challenges of European regulation, institutions and policies.

Held at the premises of one of its organisers, the Budapest campus of dually, US and Hungarian accredited CEU (, at a very central and one of the most prestigious locations of Budapest, between the city's Cathedral and the neo-classical premises of its other co-organiser, the Hungarian Academy of Science, it was located also just few hundred meters down the road from the picturesque, Gothic-styled, house of Hungarian Parliament, a representative of one of institutions of the state the conference had as part of its subject. However, the glitter of the early Christmas-festive market along one of the two roads it is cornered by, could not lit-up the dark shadow of the local media pressures the host university has been subjected to over the last few years. Being a private and international institution founded by similarly, US – Hungarian investment manager and proponent of both, political and financial liberalism, George Soros, and lead by another, outspoken proponent of political liberalism, journalist, writer and a former liberal politician Michael Ignatieff as its president and rector, the university, its visions and its founder have been somehow at odds with the new government of Hungary.

Yet, very symbolically, as if one of potential protection-towers and likely guarantors of the university's future existence, some half-way between the two recently confronted institutions, strategically overlooking Budapest's Liberty Square (Szabadság tér) and heavily fortified by its tall iron fences, located is the US embassy. However, though a representative of the university's founder's new home-country, it is also probably unlikely to become its public defender without, almost inherently exposing for questioning the independent nature of the university and it's name: The Central European University.

It may be therefore not surprising to hear that a conference expose presented by internationally renowned, former Assistant Secretary of State and Deputy Government Commissioner for Privatisation, academic and a CEU Professor Dr. Peter Mihalyi could appear as being somehow critical of the recent publications by one of the laureates of the economics-equivalent of the Nobel prize [1], Josef Stiglitz, himself very critical of the extreme economic liberalism whilst advocating protective interventions by the states and governments in ensuring employment, reducing inequalities or supporting cheaper if not free education across their social strata – the aims that can, ironically, be dismissed as being populist and illiberal.

The first day keynote speech by Dr. Michael A Landesmann on Forces of Disintegration in the Wider European Economy: a Structural Political Economy Approach took place in the same Popper room the second, similarly thought provoking and also, protectionist populism menaced EU's and the automation menaced humanity's future concerned keynote speech by András Inotai [2]. He was also concerned by lack of the common EU fiscal policy, a phrase which is becoming an euphemism for increasingly conflicting cacophony of multitude of those policies of the individual EU states, a cacophony surpassing even that of the over twenty different official EU languages (see [3]). The presentation was yet confronted by the sombre reality of the debt loaded and impoverished EU states and hence dismissed as a kind of unsustainable utopia from, a point of view based on the liberalist model of so called “thin state” whether by design or by misfortune. However, one could ask oneself if such liberalist utopia's ideal target model may be increasingly threatening to, instead, turn into a sombre reality of a failed state, or, into a Wild-West/Mad-Max stateless and lawless dystopia.

This discussion was rather symbolically taking place within the walls of university's “Popper room”, one named after Karl Popper, an intellectual hero-model and, also, once LSE mentor of the university founder George Soros whose, several times enlarged portrait featured as a mural by its entrance. Soros himself adopted political philosophy expressed in the Popper's key, liberalism and anti-totalitarianism driven work - “Open Society and Its Enemies”, which, in turn, inspired, Soros to such extent that he named his - in these current times of the rising protectionist populism, increasingly controversy-triggering educational charity - “Open Society Foundations”.

As it is impossible to cover all the thought provoking and interesting work presented at the conference, I will focus on a very poignant presentation of an even more generally indicative research by Dr. Zoltan Adam and Prof. Andras Simonovits [4]. Concerned with the two main phases of the Hungarian pension policies between 1997 and 2017, the report contrasted somehow surprising but nevertheless, concerning views that the policies of the so-called liberal-democratic populism of the first ten years (also referred to as “Goulash Capitalism” for its loose budget policies) resulted in rather unsustainable if not even irresponsible fiscal activities, a high debt build-up and even higher concerns for sustainability of the state's pension funds. Ironically, it seem that the later period of the new, apparently less liberal policies, despite abandoning progressive taxation and hence the barriers to rising inequality, has been also more constrained and responsible in spending and managing the fiscal budget, leading to more sustainable budgetary, and, as well, the pension policies. However, in the post-2008 crisis times, midst the increased life-expectancy and the stagnating population growth, the Hungarian pensions are still indirectly supported through EU co-funding whilst the usually legally mandatory obligations for employer-co-funding, the so-called 2nd pillar, of the pension system [5], have been worryingly reduced if not yet “shut down” [6].

Continues on the 7th of January.

[1] i.e. Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel.
[2] “The European Union at historical crossroads and the impact of internal and external challenges on the future of the integration”.
[3] See series of two articles Peut on sauver l'Europe? Part one and Peut on sauver l'Europe? Part two.
[4] From leftwing democratic populism to rightwing authoritarian populism: The case of Hungarian pension policies, 1997–2017.
[5] A funded system that recipients and employers pay into; this includes pension funds and defined-contribution accounts/plans.
[6] See also: Hungary Needs to Enhance Second Pillar Pensions.