If the deficit rises above 6%, not only is the credibility of our fiscal policy called into question, but it also becomes certain that this year we will be able to do nothing to bring down expenditures. We can't even argue that the economy has been on a deficit-cutting course since 2002.

This is bad news. But we shouldn't be surprised. Since 2001, both the left and the right have been methodical in undermining the budget. We got away with the Orbán government's two-year budget plan until 2002 because nobody had a clue how much money was in the treasury. But from autumn 2002, electoral spending got out of control, especially after the first round of voting. It was Péter Medgyessy's mistake to carry on running the shop without taking stock, falling into Fidesz's trap. Had he been a canny politician he might have done otherwise, but he wasn't, and nor was he much of an economist. His promises on wages and social spending, supported by Fidesz, were only affordable by borrowing from tomorrow.

The 2003 budget went in the wrong direction, since it cut state investment instead of consumption. In summer 2003, the Free Democrats called for tax cuts, which led to an increase in VAT and faster inflation. Although we didn't meet our deficit goals (of 3.8%) in 2004, we did manage to 1% off the relative deficit. And this year we're confronted by the added burden of matching EU structural funds from government sources.

This entire parliamentary cycle has been counterpointed curiously by the National Bank of Hungary, behaved very differently when it supported the Orbán government's spendthrift policies. It has complained endlessly - and with reason - about the state of the budget, although it didn't make things any easier with its interest-rate policy.