Economy as the enemy: Turkey’s crisis continues

After Finance Minister Berat Albayrak called recent food price increases “food terrorism”, President Recep Tayyip Erdoğan announced that the government would sell staples like tomatoes and peppers at reduced prices.

The Islamist government’s approach to the price crisis highlights the Turkish state tradition and its endemic weakness on economy.

An overview of the Turkish state tradition since the Ottoman era would show that it has never recognised the economy as an autonomous field with its own dynamics. Instead, the state has mostly seen economics as another administrative field.

Earlier Turkish states like the Seljuks and the Ottomans embraced complex economic systems, including taxation, production and trade. Still, notwithstanding some exceptional periods, the administrative view of economics prevailed as the main paradigm.

Dovetailing with the administrative notion of economics, the Turkish state has never accepted that economic activity requires some protections and rules. Instead, recognising such an autonomous economic field is seen as a problem of sovereignty.

For example, the state’s frequent interventions into the price market have become a political problem for market actors. A group of istanbul merchants protested the official auditors sent by the government, arguing that they harm the businesses of vegetable vendors. President Erdoğan soon called them “terrorists” and promised that the state would annihilate them in their markets as it had annihilated terrorists in their caves.

The state’s historical allergy to economic autonomy has prevented the accumulation of wealth as well as a strong protection of market actors. A striking consequence of such deficits are best observed in many Western Anatolian towns, where one never sees a genuine historical architectural landscape, unlike many small towns in a western European country. This part of Anatolia has been under Turkish rule for nearly a millennium, and one might expect historical signs.

The administrative notion of economy has prevented capital accumulation and the emergence of basic rules to protect economic agents’ properties.

Having deep reservations about the market, the Turkish state tradition has never embraced a socialist outlook in the modern period. Thus, the administrative notion embedded in the Turkish state tradition should not be confused with socialist planning.

It is also possible to observe the social reflections of the state’s reservation to both liberalism and socialism. For example, political attributes linked to infrastructure (i.e. liberal and communist) are mostly pejorative, while political attributes linked to superstructure (i.e. nationalist, religious) are mostly complimentary in Turkey.

Alarmed by any sort of economic worldview, the state in Turkey insists on a strict administrative culture in which no area is beyond political control. Thus, a Turkish businessperson is not a typical bourgeoisie, just as a Turkish worker is not a typical representative of the working class. In Turkey, both business associations and worker unions are equally passive and subservient to the government’s will.

In retrospect, both the Ottomans and the Republican regimes have adopted many economic reforms to embrace a Western and modern economic outfit. Yet these reforms have failed to disconnect the Turkish state from its traditional, and mostly medieval, notion of economy.

Many key reforms, like the January 1980 declaration of a free market regime, or Kemal Derviş’ reforms in the banking sector after the 2001 economic crisis, were spurred by necessity. Still, the resilient Turkish mentality of an administrative economics has persisted and often been resurrected, as when Erdoğan’s Islamist government nearly destroyed the Derviş-imposed financial regulations.

Seen in this way, the return of the state as a green grocer to halt inflation is nothing but a resurrection of a traditional mentality. And Erdoğan’s urging citizens at a rally last week to compare the prices of tomatoes and bullets is a perfect illustration of the historical Turkish view of the economy.

The opinions expressed in this column are those of the author and do not necessarily reflect those of Ahval.
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