The dreams of Recep Tayyip Erdogan, Prime Minister of Turkey, for the recrudescence of the Ottoman Empire are evaporating under the Istanbul sky. His party The Justice and Development party (AKP), is in disarray; a major corruption and bribery scandal has led to accusations about cabinet members and their families. The investigation prompted Erdogan to say “The judiciary will pay.”
With an election in March, Erdogan’s monolithic hold on the nation seems tenuous. The rifts, glossed over after three successive electoral victories, have reemerged. Mr. Erdogan’s attacks on police officials, prosecutors and members of his cabinet have revealed the internal fracturing.
One of the cabinet ministers who lost his job in the aftermath of the corruption revelations refused to go quietly; instead calling for Erdogan’s resignation. Departing lawmakers criticized the government for blocking the graft probe, which Erdogan has described as an international smear campaign. At this stage, it is difficult to know if Erdogan can withstand the pressure. But if he does, Turkey will either be under strict authoritarian rule or helplessly afloat politically.
The political turmoil is reverberating on the streets with thousands of protestors marching against the government in Ankara, Izmir and Istanbul. Most significantly, the economy, once described as the miracle in the Middle East, has been faltering since 2008. The lira has plummeted more than seven percent against the dollar and euro since mid-December. Erdogan’s government borrowing costs hit 10.37 percent, the highest in two years while the stock market slumped 15 percent.
The fragility of the Turkish economy has been evident for several years with a behemoth debt burden serving as an albatross on the economy. Personal borrowing has been restricted by banks up to but not above the prevailing interest rate of 32 percent. It is apparent that Turkey’s economy and financial structure cannot sustain the political risk now confronting the nation. Confidence in Turkey’s financial system is at its lowest point in 25 years.
Since foreign direct investment has been a key factor in “the decade of prosperity” (2002-2008), financial interests may be looking in a different direction. It has been apparent, for example, that in recent years Saudi Arabia has invested heavily in Turkey for both financial, political and religious reasons. With political uncertainty of the moment, that financial spigot could be turned off forcing the Turkish economy into a deep recession.
The regional implications for these events is profound. Turkey is a member of NATO and some would contend remains in the Middle East Axis of Moderation, albeit hardly a reliable member of this group. It has a secular tradition going back to the era of Attaturk, but Erdogan has attempted to Islamicize the state along Sunni lines. From a balance of power perspective, Turkey could serve as a counter-weight to Iranian ambitions with its powerful military force, a fact that is very much in the forefront of Saudi strategic considerations.
Although President Obama has called Prime Minister Erdogan “his closest ally,” relations have grown frigid over the U.S. rapproachment with Iran and the unwillingness of America to assist the rebels in Syria. Nonetheless, Turkey, through NATO, does represent U.S. interests in the region. A Turkey in disarray is not desirable from the State Department point of view.
Erdogan may have purged the military of potential opponents, but the historical antecedents remain very much in the mind of the Turkish people. A military coup to maintain order is a possibility should the level of instability worsen. This condition has not only happened several times in the recent past, it is Turkey’s way of dealing with disorder.
The U.S. is on the sidelines watching anxiously at the unfolding of events, but I hope someone in the State Department is staying up evenings contemplating what the United States will say and do should Erdogan’s government comes toppling down. That scenario is no longer so far-fetched.
Herbert London is President of the London Center for Policy Research, a senior fellow at the Manhattan Institute and author of the book The Transformational Decade (University Press of America). You can read all of Herb London’s commentaries at www.londoncenter.org