The value of the Turkish Lira against the dollar continues to sink.
Inflation is back in double-digit territory. Everyone is worried as they watch prices rise and wages fail to catch up.
Assurances from the government that the reasons for this situation lie outside of Turkey, and that everything will return to normal once the storm passes over do not sound convincing either.
Attempts to deflect blame by accusing “extraneous factors” are taken by many to mean that the government will not do what it has to in order to stop the downward spiral.
This is not to deny the effects of outside factors, of course. Every country is affected by these. President Donald Trump’s decision to pull out of the Iran nuclear deal is a case in point. Likewise changes in U.S. interest rates or employment figures also play a negative or positive role on how international currencies perform.
Overlooking the “internal factors” that also contribute to the deterioration in the economic situation, though, amounts to burying one’s head in the sand. The pro-government media conveniently overlooks this.
Instead, it prefers conspiracy theories about enemies in the west out to undermine Turkey’s economy, which would otherwise outperform the best economies if left alone.
As for the choirmaster, it is no one else but President Recep Tayyip Erdogan himself with his loaded remarks like: “they are trying to tame us with the economy, but we will not let them get away with that.” He refuses to see the negative effects of domestic instability on the economic situation.
For him, the bridges, highways and ultramodern airports being built attest to Turkey’s strength. Yet the citizen on the street whose economic situation is worsening by the day is asking what’s in all that for him or her.
Erdogan, however, does not want an economic plan that encourages savings over growth. He needs people to be spending and contributing to growth.
The reason he has declared war on high-interest rates is not just that he abhors usury as a devout Muslim. He needs the common citizen to be able to borrow at low rates so they can spend and keep the economic wheels turning.
All Erdogan has achieved by rowing against the tide, however, is to increase doubts about his administration’s ability to run the economy. This, in turn, means the public will have to brace itself for more economic woes ahead of the elections on June 24 and after it.
If Erdogan wins with a significant margin he will have more powers to try and steer the economy in the direction he wants personally. That will most likely mean more trouble.
On the other hand, the situation is not likely to get better if he loses, because whoever comes to power will have his or her job cut out in trying to get the economy back on a rational and realistic track.
What those who rule us have to do is accept economic facts, rather push conspiracy theories if they want Turkey to get out this state of affairs. Until that is done we should prepare ourselves for even more difficult days ahead.