Hungarian Prime Minister Viktor Orban speaks at a press conference after the EU summit in Bratislava, September 2016.Ronald Zak/Press Association. All rights reserved.Referendums are unpredictable and often fail to settle the question on the ballot paper. This political truism has been ignored by European governments several times over the past decade, giving many leaders a bloody nose – most recently British Prime Minister David Cameron, who lost his job over Brexit.

The latest referendum, in Hungary last Sunday, did not qualify because the turnout did not reach the 50% threshold. It looks like governments cannot win a referendum on anything in Europe these days – which should give Italian Prime Minister Matteo Renzi pause for thought, as he has just set December 4 as the date for a constitutional referendum that will define his premiership.

However, the Hungarian referendum has opened questions with wider consequences for the rest of the European Union. Even though it didn’t pass the threshold, it will have a long legacy.

Who gains from fear-mongering and fanning xenophobia?

The campaign made history by breaking two taboos: the first is that the government openly campaigned against the rest of the EU, blaming the migration crisis on “Brussels” even though the Hungarian government had voted with the other 28 in favour of a quota system. Every sixth billboard on Hungarian roads carried a supposed fact about migration that induced fear.

The government distributed more than 4 million leaflets (almost one for every two citizens) and spent some $40 million on the campaign. Every household in the country received a letter on official government stationary that stated, “We know that there are terrorists hiding among the refugees. But we also know that most of the immigrants are victims themselves. Victims of smugglers and their own governments, but foremost they are victims of the politicians sitting in Brussels who made promises to them that are impossible and unnecessary to keep. Meanwhile the European people and nations are also victims. They must cope with the economic, social and cultural burden migration creates.”

The second taboo-breaker was state-sponsored xenophobia. Every sixth billboard on Hungarian roads carried a supposed fact about migration that induced fear, including, “Did you know that since the beginning of the migrant crisis, harassment towards women has steeply risen in Europe?”, as well as “Did you know? The Paris attacks were carried out by immigrants” and "Did you know? Since the start of the immigration crisis, over 300 people in Europe died in terror attacks". Since World War II, no European government has tried to make an explicit link between terrorism and migration in a public campaign on this scale.

After this huge campaign, it will be hard for any future opposition party to rebuild a spirit of tolerance and support for accepting refugees. But it also makes it difficult for Jobbik – the far-right party that is the only effective rival to FIDESZ – to outflank the government on the right. By now, even human rights issues unrelated to migration are greeted with hostility by a majority that has become suspicious to everything foreign. After planting so many seeds of fear and hatred of foreigners, uprooting xenophobia will require an enormous effort.

Why did voters stay away from the polls?

Despite having a majority in parliament, no functioning opposition parties, broad control of the media and judiciary, a leading question on the ballot paper, and massive public funds to finance the largest advertising campaign in Hungarian history, the government only persuaded 43% to turn out on a sunny Sunday. The encouraging part is that it seems there was no vote-rigging. The signal is unclear – which allows the government to interpret the vote as it wishes.

Of the valid votes cast, 98% said no to the government’s question:”Do you want for the European Union to be able to mandate the obligatory settlement of non-Hungarian citizens in Hungary without the approval of the National Assembly?” Did those who stayed home spot the question’s erroneous premise that Hungary had no say in the decision about refugee quotas? Did the 6% who spoiled their ballots want to demonstrate that they disagreed with this premise and support burden-sharing among EU members? Did abstainers realise, correctly, that the government did not need this referendum to do what it wants to do anyway? Or were Hungarian voters just indifferent to the whole issue? No doubt there were many motives, but the signal is unclear – which allows the government to interpret the vote as it wishes.

What did this referendum reveal about the state of Hungarian democracy?

Whether “non-liberal”, as its prime minister calls it, or not, democracy is in a sorry state. The current government is dismantling every kind of opposition, even funding for civil society from Norway and its European Economic Area partners (EEA).

Four days after the referendum, the prime minister’s office responded to a year-old Freedom of Information request by the Hungarian Civil Liberties Union (TASZ), and confirmed that the prime minister personally requested the tax and criminal investigations of the EEA and Norway Grants Global Fund in 2014. On Saturday, Mediaworks, publisher of the leading leftist daily, Népszabadság, suspended both the online and print editions of the paper. Given that Népszabadság had published several stories about government corruption in the previous weeks, a political motive looks likely, confirmed by the coup-like method of suspension. Meanwhile, economic interest groups linked to Fidesz have tried to acquire the paper. The new owners of Népszabadság already control the biggest national opposition daily, and will now have over 13 influential regional newspapers. These latest events suggest a new era in the ruling party’s suppression of any critical civil society.

These latest events suggest a new era in the ruling party’s dominance of media outlets and its suppression of any critical civil society. Yet Fidesz does not really need to control all levers of political and societal influence, given the weakness of the opposition. It was the MSZP, the socialist party now in opposition, who sold their stake in Népszabadság to the companies close to Orbán in 2015. This combination of captured media, embattled civil society organisations and weak opposition parties make revival of liberal democracy in Hungary a distant prospect.

What will be the extra-territorial consequences of the referendum?

One of the big problems with referendums as a political tool is that one country’s majority vote can bind others who had no say. In an advisory referendum last year, the 2.5 million Dutch voters voted to reject the EU’s trade and association agreement with Ukraine, with potential consequences for another half a billion EU citizens and Ukrainians. The Visegrád Four countries, including Hungary, issued a statement calling for “flexible solidarity” on September 16.

The Hungarian referendum also has extra-territorial reach in pitting one democratic process against another. Even though it did not reach the threshold, it gives Orbán a “tied hands” argument to say that the 3.3 million Hungarians who supported his position should overrule the decision of 28 EU governments (including his own) on the quota scheme for sharing the burden of protecting recognised refugees.

This claim affects the community of law that underpins the EU, which depends on members complying with the rules, including when they are out-voted in the Council of Ministers. Open refusal to meet this obligation of membership has grave consequences for the future functioning of the EU. The Visegrád Four countries, including Hungary, issued a statement calling for “flexible solidarity” on September 16. Other members saw this message as free riders taking the benefits but not the responsibilities of European integration.

What can the other members do?

If Orban’s goal in calling this referendum was to make a common asylum policy harder to achieve at EU level, he succeeded. The campaign effectively built public opposition. A year ago, 64% of Hungarians thought that “it is our duty to help the refugees” and 52% believed that the refugees should be treated more humanely than the Hungarian government was doing at the time. After the campaign, at the end of September, those who wanted more humane treatment had fallen to 38%, while only 35% think they have any duty to help refugees at all.

This campaign has made a collective solution at EU level all the more difficult, by keeping the burden on the countries where asylum-seekers first enter the EU (such as Greece and Italy) and where they hope to settle (such as Germany and Sweden). And it makes it all the harder for other leaders to explain to their populations why they will share the burden if others refuse. For how long will other governments allow the Hungarian government to play the double game of agreeing at EU level and then denouncing the decision to its own public?

Might other members finally lose patience and consider new measures to sanction unilateral opt-outs from joint decisions and laws? It depends whether the European People’s Party (the EU-level grouping of centre-right parties) continues to close ranks around FIDESZ or begins to see it as a liability for the centre-right as a whole. The view of the German Christian Democrats will be decisive. The only comfort they can draw is that referendums are prohibited under the German constitution. The view of the German Christian Democrats will be decisive.

Money could be the lever of choice. Before joining the EU, countries have to meet membership conditions on stability of democracy, competitiveness of economy, and the obligations of membership. In theory, members can be sanctioned for breaching EU values under Article 7 of the Treaty, but this provision has never been used. The EU never set up a disciplinary measure on transfers from the EU budget for the countries that joined in 2004 (although it did set up a verification mechanism for Bulgaria and Romania).

Now other member-states are talking quietly about putting conditions on the biggest reward of membership for Visegrád governments. The massive transfers from the EU budget for poorer regions and farmers, which can account for up to 4% of GDP and 80% of Hungary’s public investment, could be the most important lever the rest of the EU has. No wonder that Orbán’s anti-Brussels rhetoric never contains any hint of “Huxit”; he would have too much to lose if Hungary exited the EU.