Recently, there has been frequent news about Central Bank Governor Gaye Erkan. What I understand from these news is that these do not originate from the opposition. On the contrary, the news flow reflects the struggle within Erdogan’s confidants.
Names and places cited as “sources” are put forward as a means of diversion and secondary targets. For instance, the involvement of the name Mehmet Şimşek may mean he is the next target. Where is the problem? Why are some factions “within the administration” trying to overthrow the new economic management?
It is known from his past statements that Erdoğan has a dilemma regarding interest rates. His advisors might be telling him that interest rates are being increased, but the desired result from the medicine has not yet emerged. In fact, side effects of the drug appear more severely by the day.
What side effects? During the period of tightening our belts, 224 thousand people have lost their jobs, especially in the last two months (October and November). There are tremendous complaints from tradesmen and companies about access to loans. More importantly, low-income people, especially retirees, are in a very uncomfortable situation, some demonstrating publicly.
What I have written is the complaints section and it constitutes very important arguments for those who want to overthrow the current economic management.
If the People’s Alliance (AKP-MHP) suffers a defeat in the local elections, this current economic administration will be declared solely responsible. I think the ground for scapegoating is prepared.
What do we fail to see in this picture? Are orthodox economic policies really failing?
I will repeat what I wrote many times before the May elections: “The rational economic policy” to be implemented was clear regardless of who came to power. But the current government has a problem of TRUST. ERDOĞAN himself is responsible for creating his trust problem.
The factor or risk of Erdogan, who constantly creates uncertainty as to what he will do when he wakes up tomorrow morning, is already the biggest risk of our country.
That’s why I wrote before the election, “If the government does not change the policy to be implemented 1- will take too long, 2- the cost will be higher.”
The austerity process, which would last 4-6 months if the opposition had assumed power, could last 1.5-2.0 years if Erdogan were to remain in power. And; rational economic policy, which will cost 400-600 thousand lost jobs if the opposition comes to power, will result in 3-4 million people losing their jobs if Erdogan government continues.
Now we see that the government cannot implement enough austerity and the rebalancing external deficits are too far away from desired results. Our “patient” is not suffering from a run of the mill flu, on the contrary, she has caught a severe pneumonia. Healing will not occur with the flu medicine, pneumonia will get worse as time goes by.
In this environment, the scheming against the current “rational” economic management team is the doing of those who think about their own future and their own power rather than the future of the country.
By Economist and columnist Mr Ibrahim Kahveci, via KARAR.com