Can Turkey turn into a little Russia? That is what businesspeople ask me these days. They see the current government not for what it is, but what it is not: liberal. And they want to know whether this illiberalism can grow in strength.
A glance at the news might suggest that it can, and is. Academics are arrested, and if they are lucky enough to have foreign passports, extradited, over a genuine free speech issue. The rule of law is not merely stretched, but suspended indefinitely in the fight against terror. Eastern provinces look like Aleppo.
The optics are bad, no doubt about that. But there is more to the question. Can Turkey turn into a little Russia? My short answer is no. Let me explain.
Turkey can’t turn into Russia because it doesn’t enjoy the same luxuries. Russia is suffering from a decrepit economy, with deep institutional and structural problems. But Russia has oil and gas, which gives it the ability to fill its coffers without having to have a functioning real economy. When oil prices were high, they put a shawl over gaping structural fiscal imbalances. Since oil prices dropped however, Russia has been more anxious, lashing out at its neighborhood. So its dependence on oil prices makes Russia a bad neighbor, but because it’s Russia we are talking about, that is more the problem of its neighbors than itself at this point. The fact remains that Russia can survive without economic reform, while Turkey cannot. Russia has oil, Turkey has none, and needs a vibrant real economy, which requires reform, which in turn, requires capable governance. It simply cannot indulge in illiberal autocracy.
When it comes to energy, Turkey is more like China. A dependent country, you may say. Yet Turkey is no China either. China has a domestic savings surplus, while Turkey has a huge deficit there. The Chinese surplus makes the American courts guarantor of any rule of law problem in China. That is thanks to abundant Chinese assets in the American depository system. An imported rule of law system is in action there. Turkey is different. The Turkish deficit requires a reasonable level of rule of law to be a sustainable one. So looking for a reason why liberal transformation of Turkey cannot be halted, it is the Turkish deficit. The latter makes Turkey an integral part of the free world, mind you. As long as the dollar is the reserve currency. So the Turkish deficit is a blessing in disguise for us Turks.
As long as oil prices are right, the Russian economy can endure without setting up a business friendly environment. China in turn, has generated immense economic power of its own that all but forces foreign business to engage it. That makes means it is unbound by the shackles of liberalism. The ongoing purge is only one example of this. Turkey’s deficit and lack of natural resources mean that it has to adjust to the liberal order to sustain economic growth. We have to cultivate a homey environment for foreign business, which means implementing the rule of law. If we lose that, out $10,000 per capita GDP could easily drop to half that amount. That is bad news for illiberals.
Why does per capita GDP matter, you may ask? Well, there are two types of countries: The ones where the ballot box delivers solutions, and the ones where it does not. Turkey is in the first category. Turks started their dance with the ballot box in 1950. We loved it. In 2012, an octogenarian in Konya was telling me why it is good to elect the President directly. “It can’t be a bad thing to go to the ballot box for one more post,” he laughed, “let us make the final decision.” The voting booth is the only place where Turks truly feel free. And that is how our anchor to liberalism works. If there is a significant decline in per capita GDP, you just pay for it in the ballot box. That is why those who have placed their confidence in liberal ideas should not fear for the future of Turkey. Our country’s course is set by liberal elements deeply ingrained in our being. Whatever deviations there may be today will eventually be set straight.
Originally published at www.tepav.org.tr.