Can Baydarol
Even the title I chose for this article made me realise how ‘outdated’ I am, and it did cross my mind that the young people reading this would prefer more innovative ideas to the words of this old man. I am neither an economist nor a historian. However, as a writer who believes in the importance of drawing some conclusions from the past to understand today’s problems, I believe it is important to put the following lines to paper.
My generation is one that has constantly experienced crises. We grew up with coups, lived through economic crises, and those who accepted what was happening with resignation chose to remain spectators, saying, ‘These things will pass!’ Unfortunately, however, merely remaining spectators has not been enough to break the vicious cycle we live in, and it will not be enough.
During a conversation with Prof. Dr. Ali Akarca, whom I met on an occasion and greatly enjoyed his company, I concluded that it was important to jot down some thoughts in succession about crises, particularly how to emerge from the current crisis and what is lacking, especially on the opposition front.
Without going too far back, it is important to ask, ‘What is the difference between the 2000 crisis and the current crisis?’ Let us recall that the financial-driven economic crisis, which began with the excuse of then-President Ahmet Necdet Sezer throwing a copy of the constitution at then-Prime Minister Bülent Ecevit, caused great destruction. The August 1999 earthquake, which we also experienced during the same period, combined a social disaster with a natural disaster, contributing to the crisis becoming even more severe.
The way out, even if no political power desired it, was to resort to IMF resources (while the IMF had refused to help Argentina, which was in crisis at the time, it had opened its resources to us; when asked why Turkey, it was concluded that this decision had been made under pressure from Turkey’s friends), in the form of appointing a Turk with internationally recognised credibility to head the Turkish economy. Kemal Derviş stepped in at the beginning of the 2000s as the fourth partner of the three-party coalition (DSP-ANAP-MHP). On the one hand, long-overdue structural reforms were being implemented, particularly in the banking sector, while on the other hand, the long-forgotten goal of full EU membership was being put back on Turkey’s agenda.
These developments greatly irritated the coalition’s third partner, the MHP. On 4 August 2002, MHP leader Bahçeli, who had said yes to the legal reforms or at least not opposed them, took steps that would pave the way for early elections on 2 November 2002. The background to this decision, which led to a radical change in Turkish political life, is highly debatable. However, it should not be forgotten that this marked the beginning of a two-party process (AKP/CHP) for that period, with the issue of legitimacy coming to the fore.
How would this process impact the economy?
For example, a businessman I know well had to sell his factory, which he had valued at $100 million just before the crisis, for $10 million in order to pay off his debt to the banks immediately. He was pleased to have paid off his debt. In other words, Turkey had become more affordable during this process, making it an increasingly attractive destination for foreign investors.
But can becoming an attractive destination be explained solely by becoming cheaper? The EU goal we mentioned above, the 1993 Copenhagen criteria, brought with it the assurance that respect for the rule of law, democracy and human rights would be institutionalised. In other words, as long as the desire to join the EU was at the forefront, these assurances were guaranteed, regardless of which government was in power.
In the early years of the AKP, maintaining this goal, particularly in light of the impact of privatisations, led to a significant influx of foreign capital into Turkey.
But what happened next?
The EU goal gradually disappeared, and the Ankara criteria replaced the Copenhagen criteria, the content of which we still struggle to understand. As a result, Turkey was dragged back into a political and economic crisis.
So, did Turkey become cheaper to attract foreign investors?
Apparently not. All the pressure exerted on the exchange rate to attract hot money did not make it cheaper, but rather more expensive.
Has Treasury and Finance Minister Mehmet Şimşek been able to create a Kemal Derviş effect? The answer is probably very clear. Unfortunately, no.
So, despite all his hustle and bustle and having the political winds behind him (for now), has Özgür Özel been able to present us with a realistic new narrative worth following?
We will continue the discussion in the coming days…
CHP: Republican People’s Party
AKP: Justice and Development Party
MHP: Nationalist Movement Party
DSP: Democratic Left Party
ANAP: Motherland Party