Since the global crisis of 2008, we have seen that quests for economics theories, operations and practices have come to the agenda of governments separately from the intellectual, political and ideological aspect. The existence and popularity of monetarist and supply-side economics, which came to replace statist and Keynesian regulations as of the early 1980s, was first shaken by the 2008 crisis. When other developing countries caught up with the surprising and rapid rise of Asia Pacific and noticed that the International Monetary Fund's (IMF) traditional prescriptions did not work, it completely died. However, no one wanted to accept it, as there was not another one to replace it yet. In other words, the financial empires of London, New York and Shanghai thought that they would be able to handle the situation and control the Ponzi-style chain that they achieved in the early 1980s to the extent that they delayed accepting the end of the old understanding.
The new governments that came to power after military regimes in the likes of Latin America, Brazil, Argentina and Chile noticed that Friedmanianeconomics was not liberal, but was the economy policy of closed military regimes, which pushed them to seek a third path apart from Friedmanianismand statist and populist Peronism. Former Brazilian President Lula da Silva was one of the first representatives of this quest and the new rise. In fact, this rise was inspired considerably by the rapid recovery of South Korea after the financial crisis that it experienced in the mid-1990s that pushed the country to resort to the IMF for a solution. On the other hand, China's rapid and export-based growth and the Communist Party of China's (CPC) Central Committee's market economy understanding also strengthened the search for a new solution for developing countries other than a blind and brutal statist and monopolistic market dilemma. In this period, Turkey was trying to recover from the aftermath of the 2001 crisis. The floating exchange rate regime adopted in Turkey after the 2001 crisis is a very important achievement, which has been the foundation for the construction of post-IMF economy policies, especially after 2008.
The main perspective of this period addresses the reconstruction of markets in a correct, deep and competitive way as a priority. For instance, the privatization approach in the early 1980s was aimed at disposing all public enterprises at all costs. As seen in the Telekom case, Turkey suffered great losses due to this incorrect privatization approach. In fact, a true privatization strategy does not mean a bloc transfer from a state monopoly to a public monopoly. True privatization should actually create a competitive market and deepen it. So, it does not point to bloc sales, but to the sale of public properties to the public through securization that deepens financial markets. What matters is that these properties are integrated into the global system in an efficient, competitive and appropriate way.
As can be seen, there is a new perspective and paradigm shift. The same applies to monetary and fiscal policies. All structural economic problems of Turkey, including inflation, external deficit and unemployment, stem from this incorrect, unstable understanding that is poised to fall any time and subvert everything by creating a crisis. This understanding claims that it is market-friendly and competitive; however, it is actually monopolistic and does not care about the market and competition. The monetary policy is based on the instruments of the primitive and failed quantity theory that dates back to the late 1970s and that is based on interests alone. Fiscal policy, on the other hand, rejects production-oriented fair taxation. Based on indirect consumption taxes, fiscal policy also spoils income distribution, penalize production, ensures balance through high interests and denies creating. This understanding cannot effectively evaluate tax revenues either. Now, developing countries should introduce effective and coherent monetary and fiscal policies.
As I mentioned above, emerging economies like Turkey are discussing a new economy understanding that will replace falsified statist and monopolistic economics narratives. Apart from statist and monopolistic economics that reject markets, it is possible to find a new human-centric understanding that highlights competition, inclusive growth and fair income distribution. Turkey will be one of the pioneering countries to develop and practice this understanding.