Why democracy is important for economics


Turkey has gone through a surprising local elections period. On the positive side, we shall emphasize the participation rate, almost 85 percent, which underlines a very important issue: Turkish society believes in the functioning of its democracy. That is a very good sign in a period where, in most democratic countries, people turn away from the ballots or elect non-political actors to government.

On the negative side, the elections took place in a very dire period, economically speaking. The Turkish economy has shown negative growth in two quarters in a row, which means recession in financial terms. The Turkish currency, once quite stable, has been under heavy pressure and duress for over a year. The central bank has not been able to totally offset the consequences of the depreciation and devaluation.

I have written in an article, during the night of the elections, while the results were being slowly conveyed to the public opinion, "unless there is a huge surprise after the official declaration of the results, President Erdoğan's policies will not be harmed by these results".

The big and striking surprise came with the opposition winning in Istanbul in the early hours of the next morning, albeit on a very tiny margin. This is not only the biggest metropolis in Turkey (and in neighboring countries), but also it was the symbol of success for President Recep Tayyip Erdoğan, who won the municipality 25 years ago in 1994, and who managed to keep it against all odds. The very tiny margin in votes cast created immense turmoil, ballots were reopened, and multiple recounts of votes took place. Justice and Development Party (AK Party) officials protested in multiple ways, arguing that the electoral lists were biased. The Supreme Election Council (YSK) is not likely to consider various grievances serious enough to redo the elections in Istanbul. Everyone was focused on the outcome of the electoral results in Istanbul.

Losing a municipal election is one thing, making out of this loss a success story is altogether another thing. President Erdoğan has been trying to do it, by showing that the democratic functioning in Turkey is alive and well, and that the support he enjoys from the voters continues strongly, as shown by the 51 percent of votes cast for his alliance.

On the other hand, for a week the president tried to calm the ardor of some party members and asked for a "Turkey Alliance," putting forward the need of decreasing the polarisation within society. He gave the example of the ironsmith who needs to cool down the hot iron. That was very wisely done. Alongside a coming austerity policy, the government will have to deal with very intricate international issues, like the embargo on Iran, the S-400 issue and the situation in northern Syria just to name few. So reflection and calm, after a very lively electoral campaign and after a turbulent after-campaign fortnight, was really needed.

Instead, the leader of the Nationalist Movement Party (MHP) and a close ally of the AK Party, Devlet Bahceli, has chosen to escalate the dispute verbally. On top of it, the PKK, whose inhumane dark nature and terrorist essence do not need any further disclosure, attacked the Turkish Armed Forces (TSK) on the Iraqi frontier, killing four soldiers. At the funeral of one of the soldiers, the leader of the main opposition party, Kemal Kılıcdaroğlu, narrowly escaped a lynching attempt, in what seems to be an organized provocation.

What Turkey needs now is exactly the contrary. The consolidation of a center in politics is always a guarantee of political stability, attracting a large majority of voters. Calming down the political debate is important. Not only for the government but also for the opposition. This will also immensely help to manage the current economic situation. What the economy needs now is less sophisticated instruments to bring down inflation and interest rates, but more of an overall calm, democratic functioning of the country. The more steps we take in this direction, the more we will be able to diligently manage this delicate period.