HIST 302 Spring 2007 PART 2 The

HIST 302 (Spring 2007) PART 2

The Second Turkish Republic 1960 -1980 The military takeover / coup / putsch of 27 May 1960 (27 Mayıs Devrimi / Darbesi) a) “to prevent fratricide” (kardeş katli) b) “to extricate the parties from the irreconcilable situation into which they had fallen” The conspirators: a number of radical colonels, majors and captains Greeted with explosions of public joy among student an the intelligentsia The rest of the country showed no such reaction

General Cemal Gürsel: as a figurehead, former commander in-chief of the land forces National Unity Committee (NUC) (Millî Birlik Komitesi) headed by Cemal Gürsel – 38 officers - Alpaslan Turkeş – the most influential member Declaration of professors justifying the intervention: DP acted unconstitutionally The investigatory commission – Tahkikat Komisyonu became illegal

Young Turks Tradition of military leadership of modernizatation ceased to be under the Single-Party regime Fevzi Çakmak = Millet Partisi Restructuring of Army in the 50 s. Extensive rearming and retraining of the military (NATO) The modern army = the most progressive element The process of modernization created expectations Under the guise of Atatürkism or Kemalism Underlying factor encouraging the military to intervene: A combination of frustration & renewed self-confidence

Most prestigious elements in society in the 1950’s Free professions in law, medicine, engineering and the like Military & civil servants lost ground Social background & social and economic views of the instigators of the coup NUC – discontented with DP’s economic and social policies a) A more balanced economic growth b) A more equitable distribution of wealth c) Land reform for DP social justice was not a main consideration

Military Rule May 1960 – October 1961 NUC decision (3 August) to retire 235 out of 260 generals & some 5000 colonels and majors Democrat Party suspended on 31 August & dissolved on 29 September 1960

A speedily return to constitutional rule Onar Commission – Prof. Sıddık Sami Onar A provisional constitution – 12 June 1960 giving legal basis both to the coup and to NUC The cabinet of technocrats as an executive organ To finalize the text of the constitution The Constituent Assembly (Kurucu Meclis) convened in January 1961

Consisted of two chambers Bicameral parliament 1. An upper house in the legislature: 2. the NUC (Milli Birlik Komitesi) 2. A lower house: 272 (Kurucu Meclis) representatives of a) the remaining political parties b) the professional (occupational) groups c) the provinces

The New Constitution: (1961) The Republic is described as Nationalist [milli], democratic, secular and social Social and democratic were not in the 1924 Constitution Populist and revolutionary (1924) are omitted Legislative and executive power are no longer concentrated in the GNA [Büyük Millet Meclisi] From an assembly, or convention, system to a parliamentary one

The National Assembly (Millet Meclisi) counterbalanced with other institutions to prevent a power monopoly in politics using one’s majority to become despotic

1961 Constitution derived from 3 main sources: a) The historical legacy of the Constitutions of 1876 & 1924 b) The experience of contemporary democratic states c) Turkey’s present social needs

a) Historical legacy 1876 Constitution Created an elected parliament Gave place to individual rights (limited) Gave recognition to the idea of limitation of the Sultan’s powers in the name of the people Participation of the ‘people’ in a system dominated by the Sultan The emergent principle of division of powers To replace the concentration of all legislative, executive and judicial powers in the hands of the Sultan

1924 Constitution A victory for the principle of pupular sovereignty [milli hakimiyet = halk egemenliği ] at the expence of the separation of powers Sovereignty firmly invested in the nation Nation’s soveregn rights exercised on its behalf by the GNA Only the nation and its representative GNA possessed authority GNA the source of executive as well as legislative power

1961 Constitution Provided greater degree for the separation of powers An impartial Presidency A parliamentary form of government in which a balance between government and parliament 1876 & 1924 “government with parliament” 1961 parliamentary government

b) Contemporary experience Illuminated by ideas about representative democratic government Insistance on patriotism = national (rather than nationalism), on laicism, on the legitimacy of power only through elections Subjecting political power to the inspection of public opinion & political institutions.

c) Present needs i) Strong democratic government to carry through economic and social development in a planned way ii) Inclusion of social rights Constitution is a foundation stone for a democratic welfare state (refah devleti)

1. New Institutions 2. Two Chambers: National Assembly [Millet Meclisi] & Senate [Senato] together Türkiye Büyük Millet Meclisi The National Assembly 450 members The supremacy of the lower house - the last voice More representative on account of its system of election by proportional representation Term of office is 4 years Deputies need only be 30 years of age and be literate

A second chamber : Senate (Senato) 150 elected members Natural members life membership for member of the NUC 15 members appointed by the President former presidents The term of office of all elected and appointed senators is 6 years 1/3 of elected and appointed members of the Senate retire every 2 years Senators have to be at least 40 years of age & to have had higher education

2. An independent Constitutional Court (Anayasa Mahkemesi) to review the constitutionality of the laws of the GNA High Council to try the President, the PM, & other ministers & highest legal personages for offences arising out of their duties Suits for annulment of laws and standing orders Suits for the closing down of political parties

3. Full autonomy for the judiciary, the universities and the mass media 4. The system of proportional representation: to prevent the division of the country into two hostile camps to lessen the chance of one party to make single-party government unlikely holding an overwhelming majority

5. A full bill of civil liberties - To strengthen the basic rights Social and economic rights and obligations the right to bargain collectively and to strike the right to social security and medical care 6. A constitutional role for the military: the National Security Council (NSC) (Milli Güvenlik Kurulu)

National Security Council March 1962 advised the government on internal and external security Members: The chief of the general staff [genel kurmay başkanı The service chiefs [kuvvet komutanları] & The ministers concerned [ilgili bakanlar] A powerful watchdog, sometimes replacing the cabinet as the center of real power and decision-making

The President of the Republic A tendency to make the President an arbiter in the political struggle More distant from the GNA than formerly The requirement of political neutrality Yet, the break from Parliament is not complete

President chosen by the GNA for seven 7 years (longer term of office) by a 2/3 majority of the GNA in plenary session [NA + Senate] from among members of the GNA who are at least 40 years old + higher education should not be responsible to GNA The president is not eligible for re-election

The referendum on the new constitution (9 July 1961) A severe setback for the forces of 27 May Accepted with 61. 7 against 38. 3 per cent of the votes cast The ban on political activity lifted (13 January 1961) RPP & RPNP reactivated

New Parties 1) The Justice Party [Adalet Partisi] headed by Ragıp Gümüşpala; retired general Primary goal full rehabilitation of the retired officers and arrested democrats 2) The Workers [Labor] Party of Turkey [Türkiye İşçi Partisi] headed by Mehmet Ali Aybar, publicist, lawyer, former University academics 3 ) The New Turkey Party [Yeni Türkiye Partisi] headed by Ekrem Alican

The parliamentary elections (15 October 1961) RPP gained % 36. 7 : (171 seats) disappointed JP polled % 34. 7 (158 seats) The New Turkey Party got % 13. 9: A continuation of the Freedom Party founded by dissident Democrats in 1955 The conservative RPNP polled % 13. 4

Taken together, the parties which were considered heirs to DP were still the strongest in the country The new constitution more liberal than the old one: It tolerated a wider spectrum of political activity than before, both to the left and to the right

The trial of the old regime: Yassıada Mahkemeleri 31 sentenced to life imprisonment & 418 to lesser terms, while 15 sentenced to death (11 death sentence commuted) müebbed hapis Adnan Menderes, Fatin Rüştü Zorlu and Hasan Polatkan hanged Celal Bayar’s death sentence commuted because of his advanced age

A Period of Transition – the Period of Coalitions 1961 -1965 Heavy pressure on the two party to collaborate in a coalition to be led by İsmet İnönü The First İnönü Coalition A marriage of convenience, not love Failure: a) the amnesty for the former DP politicians b) the project for a planned economy The JP rejected as insufficient a proposal to reduce the sentences of the Democrats

The Second İnönü Coalition İnönü formed a new cabinet A coalition with the two smaller parties Many frictions The worst: the proposal for a land tax

Cemal Gürsel asked the JP leader, Ragıp Gümüşpala to form a government. He failed in his attempt The Third İnönü Coalition A minority coalition of RPP and independents JP brought it down: budget is not approved A Caretaker Cabinet headed by Suat Hayri Ürgüplü (a former diplomat)

Elections in October 1965 JP won a landslide victory gaining an absolute majority of the votes cast ( % 52. 9) RPP was down to % 28. 7. The other parties gained les than % 7 Workers’ Party of Turkey (WPT) in the parliament: 15 deputies

National remainder system NRS Milli Bakiye Sistemi % of votes = % of seats in parliament Permitted the Workers’ Party 15 seats in the assemby

Demirel, prime minister. He dominated Turkish politics for the next five years Goods years for Turkey High economic growth - % 6. 9 growth rate & Continual increases in real incomes Demirel’s most important achievement Reconciliation of the army & the rule by civilians The price paid: The armed forces were granted almost complete autonomy

JP was a coalition of 1. industrialists 2. small traders and artisans 3. peasants and large landowners 4. religious reactionaries 5. Western-orientated liberals It had very little ideological coherence

Demirel’s frequent recourse to two tactics To preserve the unity of the party and his own position 1. Emphasis on the Islamic character of the party He stood for traditional values Flirted with leaders of Nurcu movement 2. Constant anti-communist propaganda campaign & harassment of leftist movements

He became unpopular among intellectuals But his support held up well in the countryside The elections of 1969 JP suffered slight losses ( %46. 5) RPP polled only % 27. 4 JP formed a new cabinet Slightly more centrist than the old one

Problems within JP – Opposition to Demirel. He lost the support of the most conservative wing a) Anatolian landowners & b) small traders and artisans over his proposals for new taxation to help pay for industrialization

February 1970 The right wing of the JP voted with the opposition & forced Demirel to resign March 1970 New cabinet - No alternative to Demirel Rift (split - dissention) superficially healed

December 1970 JP decedents 41 deputies and senators left the JP & founded the Democratic Party (Demokratik Parti) led by Ferruh Bozbeyli its name, recalling DP

Left of Center (Ortanın Solu) New definition for RPP The RPP moved left of center A new manifesto in the 1965 elections written by two coming men of RPP Turhan Feyzioğlu and Bülent Ecevit

Emphasis on social justice and social security without being explicitly socialist To mobilize the votes of 1) workers 2) 2) inhabitants of the shanty towns (slum areas of towns)

RPP new stance did not profit in 1965 elections Lacked credibility as a progressive party The people in the squatter towns basically villagers who had moved to the big city taking their village values with them as in the villages, they voted JP

JP propogandists’ tactics: Left of center is the road to Moscow Ortanın Solu Moskova’nın Yolu

After the defeat – Acrimonious (bitter) debate – Infighting Blaming “the left-of-center” tactics Extraordinary Congress of RPP - 1967 Increase of the central office’s hold over the party Party dicipline

A group of 47 representatives and senators who opposed the left-of-center line left the party to found the Güven Partisi (Reliance Party) led by Turhan Feyzioğlu Right of center Ecevit’s main competitor for the position of “Crown prince” Personal jealousy

The growth of political radicalism On the left: A growing student population & a growing industrial proletariat On the right: JP policies served the interests of the modern industrial bourgeoisie, of big business

However, JP’s electoral base consisted of a) farmers b) & c) b) small businessmen They became the prime targets of both a) the Islamic party b) the ultra-nationalist party

NAP The NAP led by Alpaslan Türkeş – an ultra-nationalist (Nationalist Action Party / Milliyetçi Hareket Partisi) Claimed to be opposed to both monopoly capitalism & communism From RPNP to NAP – 1969 Hierarchically organized, militant with ultra-nationalist program – Nine Lights (Dokuz Işık) Youth Organization – Ülkü Ocakları + Bozkurtlar

NOP The NOP ( National Order Party / Milli Nizam Partisi ) 1970 headed by Necmettin Erbakan. Voice of smaller businessmen Used “Islamic” discourse to criticize the monopolies as lackeys of the Christian/Jewish West They posed a serious threat te Demirel’s power

Political violence in the late 1960 s Bombing attack, robbery and kidnapping National Remaider System abolished in March 1968 Representatives of WPT played a very important role as opposition Left, without ouftlet for expressing discontent in the assembly, vented their frustrations in the street

The violence of the left met and surpassed by violence from the militant right By early 1971: Demirel weakened by defections - Became paralyzed He was powerless to curb the violence on the campuses and in the streets. He could not hope to get any serious legislation on social or financial reform passed in the assembly

The fragmentation of the Right became the major factor of political instability By the early 1970 s Situation became explosive A dangerous mix Student and working-class militancy Social and economic changes Growing political conflict World situation

A revolution of rising expectations Expectation were not met German economic miracle had syphoned off workers Population growth Widespread unemployment Job market unable to absorb the younger population Overcrowded schools and universities Ideal for recruiting militants for the Left and the Right Youth played a crucial role in creating political instability

Demirel sided with Turk İş Wanted to destroy DİSK A Law : Unless represented at least 1/3 Workers came out in protest on 15 -16 June 1970 Paralysed the Istanbul-Marmara region The Right described the protest as “a dress rehearsal for revolution”

Beginning of 1971 – A state of turmoil Leftist student militants robbed banks Kidnapped US servicemen Attacked American targets Constant strike activity The Gray Wolves, neo-fascist militants Attacked professors who were critical of the goverment Islamists became more aggressive Openly rejected Atatürk and Kemalism, infuriating the armed forces

12 March Memorandum (12 Mart Muhtırası) Handed by the chief of the general staff It amounted to an ultimatum by the armed forces The memorandum demanded: A strong and credible government to end the “anarchy” & and carry out reforms “in a Kemalist spirit” If demands were not met, the army would “exercise its constitutional duty” and take over power itself

Demirel resigned İnönü denounced any military meddling in politics The new government installed by the generals headed by Nihat Erim, member of the right wing of the RPP Ecevit, infuriated, resigned as secretary-general A cabinet consisted largely of technocrats from the outside the political establishment. Nihat Erim announced that his government would: 1. restore law and order 2. enact a number of long-overdue socio-economic reforms

Atilla Karaosmanoğlu (World Bank) drew up a reform program: 1. Land reform 2. Land tax 3. Nationalization of the mineral industry 4. Joint ventures to protect Turkish industry at least % 51 Turkish-owned Stubborn opposition from vested interests in business and agriculture But sophisticated industrialists like Vehbi Koç and Nejat Eczacıbaşı supported the reform proposals

Renewed terrorist attacks NSC proclaimed martial law in 11 provinces Renewed every two months for two years Persons suspected of terrorism rounded up Witch-hunt - The persecution of the left Progressive liberal sympathisers arrested 5000 people put to jail leading intellectuals (writers, journalists, professors), leading members of the Workers Party of Turkey prominent trade unionists

The NOP & WPT closed down in May & July 1971 Erbakan allowed to resume his activities in October 1972 under National Salvation Party (Milli Selamet Partisi) Erim to compromise with the conservatives in the assemby Demirel’s old ministers in the cabinet

11 reformist technocrats resigned Replaced by politicians from the right Erim’s new cabinet amendments to the constitution aiming at making it less liberal support of the parties of the right

44 articles were changed. Basically: 1. Limits to civil liberties 2. End to the autonomy of the universities and of radio and TV 3. Limit to freedom of the press 4. Curtailment of the powers of the Constitutional Court 5. Increase of the powers of the NSC giving unsolicited advice to the cabinet - Binding advice 6. Foundation of special State Security Courts (Devlet Güvenlik Mahkemeleri) to try over 3000 people Abolished in 1976

The assembly refused the right to rule by decree (kanun hükmünde kararname) Nihat Erim resigned (April 1972) Succeeded by Ferit Melen one of the leaders of the Reliance Party Collaborated more closely with JP Principled stance of Ecevit ousted İnönü from the RPP chairmanship succeeded him in Party conference (May 1972). İnönü resigned from the RPP (November 1972)

The term of office of Cevdet Sunay (1966 -1973) came to an end The army put forward the chief of general staff Faruk Gürler as his successor Gürler was defeated Fahri Korutürk, a retired admiral, became the president He appointed the economist Naim Talu to lead a caretaker government to take the country to the free elections

October 1973 Elections: produced a surprise result RPP polled % 33. 5 against % 29. 5 won by JP NSP: % 11. 9 None of the parties had an absolute majority Long-drawn-out negotiations January 1974 - a new cabinet Based on the surprising combination of RPP with NSP

RPP: Social Democratic Identity Won its votes in the progressive, industrial belt Not in its traditional stronghold of backward, east and central Anatolia Attractive to urban migrants Social democracy as the ideology of the future

NSP : Opposition to the growth of monopolies & dependence on foreign capital Call for heavy industry & an economy based on Islamic values (interest-free banking) The New Cabinet A marriage of convenience: Common basis: the distrust of a) European and American influence b) Big business

Cyprus crisis broke out Turkish forces in Cyprus Ecevit became a national hero overnight Karaoğlan He wanted to use his popularity to gain an absolute majority in early elections Resigned to instigate new elections (September 1974)

A major miscalculation A caretaker cabinet under Professor Sadi Irmak Demirel finally formed a coalition: First Nationalist Front JP, the NSP, the NAP, RRP and defectors from the DP Bribing them with cabinet posts – 30 ministers

Disproportioned influence of NSP & NAP Colonizations of ministries in an unprecedented way Thousands of civil servants discharged or demoted Replaced with party loyalists Increased violence and economic crisis The elections of 1977 Ecevit’s popularity - RPP got % 41. 4 JP went up to % 36. 9 A stalemate Attempt by Ecevit to form a coalition with the independents Failure

Second “Nationalist Front” coalition by Demirel Influence of the NSP and NAP greater than in the first one Short lived. JP deputies defected Ecevit formed a cabinet with defectors now independents The independents given cabinet posts It survived until October 1979 It could not master the rising tide of violence

The military grew increasingly disillusioned with Ecevit’s soft attitude to terrorism and Kurdish separatism October 1979 elections for the senate Drop in support for the RPP Defections from RPP Ecevit lost majority - Resigned Demirel returned to power Minority government supported by independents

JP-RPP coalition proved impossible to realize throughout 1973 -80 They were unable to cooperate The political system gradually became paralysed giving small extremist groups disproportionate influence Polarization of the big parties due to ideological factors President Fahri Korutürk’s term ended in 1980 Paralysis -The assembly proved incapable of electing president after 100 rounds of voting

Overwhelming problems Turkey faced in the 1970 s (1) Political violence (2) Economic crisis. The development policies of the governments : the substitution of imports through industrialization Direct investment incentives: subsidies & tax rebates

Economic crisis 1973 – 1980

The creation of a home-grown industry: 1. Extensive import restrictions and high tariffs 2. Manipulation of the exchange rates 3. Creation of a buoyant internal market

1. Extensive import restrictions & high tariffs to keep out European & American industrial products 2. Manipulation of the exchange rate by keeping the rate of the TL artificially high Firms, to buy foreign investment goods & raw materials, allowed to purchase $ or DM comparatively cheaply 3. Creation of a buoyant internal market through Populism: a) paying high guarantee prices to farmer (above world price) b) allowing industrial workers high wage rises

Industries which would never have been able to compete on world market made handsome profits on the home front. New industries spread unevenly among regions Vast majority established in the Istanbul area smaller concentrations around İzmir and Adana Import-substitution strategy successful for some time 1963 - 1976 the annual rate of growth averaged % 6. 9

Role of the state economic enterprises still important % 40 of total industrial production Inefficiency: Reasons: 1) Political concern 2) Social concern 3) 1. Business decisions in the state sector, including the pricing of products, remained politically influenced 2. Huge overstaffing as a result of patronage system Result: Heavy losses to be covered through the state budget

New industries heavily dependent on imports (foreign parts & materials for production) dependency: on the availability of foreign reserves to pay for them Economy became extremely vulnerable Since the 1950 s Increasing dependence on oil as a source of energy The oil crisis of 1973 -74 quadrupled price on the international market Steep rise in import bill

Second oil price shock in 1979 -80 2/3 of foreign currency earnings to meet oil bill Recession in Europe Western market for Turkish products declined For a while Possibility to keep up economic growth by depleting the Central Bank’s foreign reserves

Using the transfers of the Turkish workers in Germany Remittances began to decline steeply after 1974: a) Recession – Unemployment b) Political unrest – Loss of trust 1. The situation of the workers in Europe deteriorated 2. They lost confidence in the situation in Turkey They kept their money in Germany

Governments tried to solve problems by: 1. concluding costly short-term Eurodollars loans 2. printing money 3. conserving foreign reserves through import restrictions Scarcety of oil for industry & electricity generating By 1979 power cuts off up to 5 hours a day Fuelled inflation a) Rising price of energy b) Irresponsible financial policies

Inflation running around % 20 during the early 1970 s By 1979 it was at % 90 To keep inflation down: 1) price control thought Price-Control Board Result = huge black market 2) Artificially high rate of exchange for the TL Devaluation always came too late

Import restrictions imposed to save foreign exchange a) fuelled the black market b) gave rise to large-scale smuggling Radical measures to extricate Turkey from its financial and economic impasses Ecevit negotiated with IMF, World Bank and OECD for new credits (1978) Creditors demanded drastic economic reforms Agreement to release 1. 8 billion $ in new credits (July 1979)

Dependent on a reform program to be implemented 1. Abolishing import and export controls 2. Cutting subsidies 3. Freeing interest rates 4. Raising prices 5. Cutting government expenditure Demirel’s government The task of implementing given to Turgut Özal the under-secretary (müsteşar) for economic affairs in charge of planning

24 January 1980 Reform package launched (called “Chilian solution” ) Credits began to arrive Widespread resistance Activities of the trade unions made it impossible to implement economic package Members of DISK occupied factories - Strikes accompanied by clashes with the security forces

The Third Republic Political Structure 1980 - 2007

The Third Republic The coup: 12 September 1980 Armed forces took over political power – To save democracy The communiqué State organs had stopped functioning

The the existing political system uprooted 1. Parliament dissolved 2. Cabinet deposed 3. Immunity (dokunulmazlık) of the deputies lifted 4. Political leaders arrested 5. Political parties abolished 6. Radical trade unions confederations, DİSK and MİSK suspended 7. Mayors & municipal councils dismissed A state of emergency (olaganüstü hal) declared

Concentration of all power in the hands of the military National Security Council (Milli Güvenlik Konseyi) headed by General Kenan Evren declared head of state (devlet başkanı) (14 September 1980) Local commenders, under martial law, given wide-ranging powers Closures of newspapers – Arrests of journalists & editors Eventual return to democratic system envisaged

Enforcement of radical changes before handing power back to the civilians Undoing work of their predecessors, perpetrators of 27 May Saw their task: a) saving democracy from the politicians b) Purging the political system A 27 -member cabinet under Bülent Ulusu (Retired admiral) Composed of bureaucrats and retired officers

A wave of arrests swept the country after the coup In the first 6 weeks - 11. 500 people arrested By the end of 1980 - the number grew to 30. 000 After one year - 122. 600 arrests had been made Politically motivated terrorist attacks diminished but at great human and social cost Trials held before military courts under martial law Within 2 years - 3600 death sentences pronounced 15 carried out. Tens of thousands of lesser sentences

The new constitution prepared by a constitutional committee headed by Professor Orhan. Aldıkaçtı (İstanbul University) A constituent assembly (Danışma Meclisi) of 160 members met on 23 October 1981 (120 appointed by the military governors, 40 by the NSC) Elected 15 -member constitutional committee The Constitution of 1982 A reversal of the 1961 constitution

1. Concentration of power in the hands of the executive 2. Increase of the powers of the president and the NSC 3. Limits to freedom of the press, freedom of trade unions (banning political strikes, solidarity strikes & national strikes) 4. Limits to rights and liberties of the individual The usual rights and liberties (freedom of speech, freedom of association, etc) included in the constitution

Rights & Liberties could be annulled, suspended or limited on the following considerations: 1. the national interest, 2. public order, 3. national security, 4. danger to the republican order and public health. Constitution subjected to a referendum 7 November 1982 Voting made compulsory Anyone who chose not to or neglected to vote: a) had to pay a fine b) lost the right to vote for five years

Criticism of a) the constitution b) speeches General Evren held in favour of yes vote c) banned The referendum yielded expected result: a yes vote of % 91. 4 New Law on Political Parties promulgated (March 1983) Politicians active before September 1980 banned from politics for 10 years

New parties could be formed but their founders needed the approval of the NSC Students, teachers & civil servants barred from party membership Parties not allowed a) to found women’s or youth branches b) b) to develop links with trade unions c) to open branches in villages. 15 parties founded, but 12 not approved by the military

3 parties allowed to take part in the elections 1. The Party of Nationalist Democracy Milliyetçi Demokrasi Partisi Identified with & supported by the generals Led by retired general Turgut Sunalp 2. The Populist Party Halkçı Partı led by Necdet Calp 3. The Motherland Party Anavatan Partisi led by Turgut Özal - behind the economic reform program served as a minister in charge of the economy under the military regime (Bülent Ulusu government)

6 November 1983 Elections MP scored an overwhelming victory - polling over % 45 PP did reasonably well to poll % 30 PND came third with % 23 New electoral system heavily weighted in favor of majority To limit the disproportionate influence of the small parties Before 1980 = one of the reasons for the breakdown of system The % 45 gave the MP an absolute majority

Under Turgut Özal slow process of further democratization went on Before the municipal elections of March 1984 the parliament voted to allow some of the parties banned the year before to participate The Municipal elections of March 1984 The MP did only marginally less well than five months earlier % 41. 5

The Social Democratic Party 23. 5 per cent [Sosyal Demokrat Parti ] led by professor Erdal İnönü The True Path Party polled % 13. 5 [Doğru Yol Partisi] Süleyman Demirel’s party, - fronted by other politicians The National Salvation Party, got % 4. 5 of the vote [Milli Selamet Partisi] Necmettin Erbakan’s party, - fronted by other politicians The Populist Party less than % 9 The Party of Nationalist Democracy only % 7

Strange political landscape Opposition parties in parliament lost their legitimacy Parties with sizeable portion of the electorate behind them not represented on a national level Solutions: On the Left: PP and SDP merged to form Social Democratic Populist Party [Sosyal Demokrat Halkçı Parti – SPP] November 1985.

A new challenger for the inheritance of old RPP The Democratic Left Party DLP Demokratik Sol Partisi - DSP Led from behind the scenes by Bülent Ecevit fronted by his wife, Rahşan Ecevit - party chairwoman The Ecevits a) depicted SPP as elitist and old fashioned b) declared the PDL as the only true workers’ party On the Right The leadership of PND dissolved the party - May 1986 Representatives joined the MP & PTP

18 members of SPP deserted to the DLP - December 1986 giving DLP representation in parliament Özal accepted the challenge of the old guard Referendum on a change in the constitution to allow the old politicians to take part in politics

Referendum - 6 September 1987. % 50. 24 yes against % 49. 76 no The result of the referendum led Özal to announce early national elections

29 November 1987 Elections The MP managed to retain its absolute majority MP polled % 36. 3 SPP % 24. 5 PTP came third - % 19. 2 Other parties failed to pass the threshold [baraj] (% 10)

March 1989: Municipal elections The results: Support for the MP severely eroded MP suffers major defeat in local elections Reasons: Corruption and unpopular economic policies With both voters and private sector

SPP came out on top, % 28. 2 PTP came second % 25. 6 MP managed only third place % 21. 9

Evren’s term came to an end - November 1989 Regardless of the electoral result Özal stood as presidential candidate The opposition boycotted the session of the TBMM in which the new president was elected Turgut Özal elected 8 th president of Turkey

Yıldırım Akbulut replaced him as PM He lacks Özal’s authority & fortunes of party decline hereafter

Reasons for the decline of Özal’s popularity High inflation - back to pre-1980 level of around % 80 Erosion of purchasing power 2. Nepotism and corruption surrounding the regime

Özal’s belief: Unrestricted capitalism free-for-all Resulted in a number of business scandals Özal family criticized for a) nepotism b) corruption in their business activities

June 1991 Mesut Yılmaz elected leader of MP Forms new cabinet He is expected to give party youthful and modern image 20 October 1991 Elections: PTP (center-right) won the elections %27 MP % 24 SPP - disappointing result % 20 included votes for People’s Labour Party (Halkın Emek Partisi) Their candidates contested the elections on the SPP slate

Personal animosity between Demirel and Özal prevented coalition A coalition of PTP and SPP Süleyman Demirel: Prime Minister Erdal İnönü: Vice Prime Minister 17 April 1993 President Turgut Özal dies of heart attack at age of 66 Parliament elects Süleyman Demirel as Turkey’s 9 th president Leaving his party without strong leader

13 June 1993 Tansu Çiller elected leader of TPP First woman to lead Turkey, heading coalition with the Social Democrats 25 March 1994 The Welfare Party, (the party of political Islam) Makes a breakthrough in local elections Its candidates becoming mayors of Istanbul and Ankara

18 February 1995 Social Democrat parties – RPP and SPD unite under umbrella of RPP 23 July 1995 Parliament passes amendments to 15 articles of constitution, designed to make political life more democratic 20 September Coalition collapses, leading to early election 24 December 1995 WP (representing political Islam) wins with % 21. 38 of votes and 158 seats,

Insufficient to form government Political crisis follows 6 March 1996 MP and TPP coalition is formed Unstable - hostility between two leaders Mesut Yılmaz – Tansu Çiller 6 June 1996 Mesut Yılmaz resigns opening way for Necmettin Erbakan

29 June 1996 Erbakan and Çiller announce formation of coalition Both leaders agree to shelve investigations of corruption against each other 28 February 1997 NSC advises Erbakan-led coalition to clamp down / put pressure on Islamist activity, especially the wearing of headscarves in universities 18 June 1997 Erbakan decides to resign hoping to be replaced by Tansu Çiller as PM and for coalition to continue

President Demirel appoints Mesut Yılmaz (Motherland Party) to form new coalition New coalition: Yılmaz + Ecevit 16 January 1998 a) Constitutional court orders dissolution of Welfare Party for violating principle of secularism, b) Bans Erbakan from party’s leadership for 5 years 17 December 1997 In anticipation Islamists had already formed Virtue Party (Fazilet Partisi)

21 April 1998 Continuing offensive against political Islam Recep Tayyip Erdoğan, Mayor of Istanbul and member of VP sentenced to 10 months’ imprisonment for a speech made in 1997, exploiting Islam & inciting religious heatred 26 November 1998 PM Mesut Yılmaz resigns amid charges of mafia connections 11 January 1999 DLP leader Ecevit forms new cabinet to lead the country to an early general election

18 April 1999 General election won by Ecevit and NAP (extreme right) center-right parties collapse 3 May 1999 Ecevit is reappointed PM Coalition with NAP and MP 5 May 2000 Ahmet Necdet Sezer, president of Constitutional Court, replaces Demirel as president

21 June 2001 Constitutional Court dissolves VP, describing it a center of Islamic fundamentalism 21 July 2001 Political Islamists form Felicity Party (Saadet Partisi) as successor to VP 14 August 2001 Moderates from VP, led by Recep Tayyip Erdoğan, found Justice and Development Party (Adalet ve Kalkınma Partisi) claiming to be secular ‘Muslim democrats’, not successors to former VP

3 November 2002 Early general election brings AK Party to power with % 34. 3 of ballot and 363 seats RPP with % 19. 4 & 178 seats becomes the opposition with no other parties managing to clear the % 10 electoral barrier

Economic Structure 1980 – 2005

1980 -1991 The efforts to restructure the economy 24 January 1980 : “The “stabilization program” Turgut Özal the architect of the IMF-inspired economic reform package of the last Demirel cabinet The Program become effective after 12 September 1980: Military takeover The suppression of the trade unions and the political left by the military

Renewal of confidence for Turkey International business world and financial community represented by the IMF, the World Bank and the OECD, Flow of credits, denied to pre-1980 governments, resumed. National debt grew from 13. 5 billion $ to 40 billion $ in 1989. But the repayment posed no real problems

The aims of the program. Threefold 1. To improve the balance of payments 2. To combat inflation 3. To create an export-orientated free market economy

The means employed to attain these goals: 1. Drastic (and ongoing) devaluation of the TL to make Turkish exports competitive in foreign markets 2. Rise in the interest rates: From – to + interest rates to reduce over consumption and thus inflation. 3. Wage-freeze of workers to increase competitiveness and lower inflation 4. Price-rises - the abolition or reduction of state subsidies to reduce budget deficit

Exports encouraged through a set of specific measures: 1. Subsidies for exporters – tax examption etc. (vergi iadesi) 2. Simplification of the notoriously complicated bureaucratic export procedures 3. Abolition of the customs duties on imported inputs for exportorientated industries

A drop in real purchasing power of between %40 - 60 for most wage-earners in the years 1979 -89 Caused by: a) price rises b) a freeze on wages c) high interest rates (purchases on credit reduced) The main winners of the decade: Large-scale economic units the existing and emerging big holdings

Types of family holdings in the 80 s 1. generation: RPP generation Koç & Eczacıbaşı group had roots which went back to the 1920 s. 2. generation: DP-AP generation Sabancı group begun their rise in the 1950 s 3. generation: ANAP generation Anka and STFA - Building firms (early 1980 s) profited from building boom in Arab oil-producing countries used the opportunity to branch out into other sectors

Nearly all these firms a) family-owned b) structured as holding companies with their own banks, insurance, trading and production companies. The early stage of accumulation & import substitution Imports and joint ventures with foreign firms Main business: production of goods under license Holdings, in times became export-orientated without halting their earlier activities

The government tried to keep down prices for industrial goods by encouraging competition on the home market through the abolition of import restrictions Luxury items could be freely imported subject to a special tax Revenue used for the housing program (toplu konut)

Foreign investors encouraged: 1. No longer faced discriminatory measures 2. Repatriation of invested capital and the export of profits made possible 3. Investors given preferential treatment regarding import duties 4. Free trade zones instituted in different places (around the ports of İzmir and Mersin and near Adana) Firms sep up factories & re-exported their products

Government promoted investment in infrastructure & utilities 1. Telecommunications & road networks modernized 2. Construction of natural gas pipelines from the Soviet Union Significant impact on air pollution replacing the inferior coal & lignite

New constructions took place on “build-operate-transfer” basis (yap-işlet-devr et) 1. Foreign investor builded a facility (a power plant, airport) & 2. Operated it until its costs recovered & profit margin achieved 3. Handed over facilities to government for further operation Used in energy & tourism sector

The building up of a tourism industry energetically pursued By the late 1980 s - Turkey captured a sizeable part of Mediterranean holiday market became a popular destination for package tours The Gulf crisis - 1990 -91 hit the tourism industry hard It recovered quickly in 1992 following the civil war in the former Yugoslavia

South-Est Anatolia Project Gigantic (GAP – Güneydoğu Anadolu Projesi) energetically pursued project The plan envisaged the building of a whole complex of dams on Fırat and Dicle including hydro electrical plants and irrigational works a) to produce energy for industry b) to irrigate 1. 6 million hectares in the plain of Harran doubling the area under cultivation

The main part of the project The enormous Atatürk dam on Fırat opened in 1992 The project and the dam built without financial assistance from international agencies For political reasons to avoid having to reach agreement with downstream countries about sharing the water Syria and Iraq

The stabilization program achieved many of its aims: 1. Exports grew by an average % 22 yearly during the years 1980 -87 2. The nature of Turkish exports changed over the decade In 1979 % 60 of exports had consisted of agricultural products In 1988 this was down to % 20

Over the same period the % of industrial products in total exports grew to over 72 Among the industrial goods textiles were of special importance contributing over a 1/4 of the total value of the exports 3. Export destinations changed

The early 1980 s coincided with the 2. boom in world oil prices The Turkish exporters, supported by the Government managed to profit from the new wealth in the Arab oil-producing countries A period Turkish exports to the Middle East & North Africa exceeded those to EC with Iran the single biggest market B period The older pattern re-established itself E C once again main Turkish export market

Imports went up and exceeded exports The balance of payments gap closed by remissions from workers in Europe Political stability & attractive interest rates above the rate of inflation encouraged workers to put their money in Turkish banks High interest rates & wage freeze combined to lower inflation - % 30 - 40 in the ½ of 80 s

Inflation rose once again it reached its pre-1980 level in 1988 Reason: The continuing high budgetary deficit Causes: 1. Failure to curb the growth of civil service 2. Inefficient taxation Profits of the industrial holdings left untouched 3. Huge state industrial sector KİTs Inefficient and largely loss-making

The privatization program progressed very slowly Reason: State industries - old-fashioned & overstaffed The private investors not interested in them The abolition of a number of government monopolies: private airline companies & television stations 1989: The turning-point – Spiriling inflation

1. A serious drought (dry weather) Agricultural producers (and exporters) hit hard 2. Increase in interest rates Cutbacks in government investment 3. A high exchange rate for the TL The TL’s gradual devaluation dropped behind inflation By 1990 it was overvalued by some 40 per cent The economic policies of the 1980 s greatly increased the differences between rich and poor

1. A new class of often very wealthy entrepreneurs arose Fortunes made in import, export & construction 2. The purchasing power - the majority of the population drastically reduced & real poverty in many homes 3. A steep rise in the number of unemployed (İşsizlik) Labor unrest increased - 1990 -91 January 1991 – 1. 5 million employees held a general strike

The slowdown in the world economy at the end of the 1980 s The projected growth of the 6. Five-Year Plan (1990 -94) proved unattainable Turkey more sensitive to global economic trends because of its export-orientated economy Turkey entered a period of low growth combined with high inflation and growing unemployment

1994 Nature of crises Balance of payments crises Originating mainly from the capital account Caused partly by domestic imbalance Origins: Fiscal imbalances; Relaxation of austerity measures steady appreciation of the real exchange rate; export stagnation, import boom, outflow of short-term capital

External Dimension Significant over-dependence on fragile short-term capital inflows following premature capital account liberalization in August 1989 International actors in the post-crisis context: IMF : the primary actor EU: involved through the Customs Union

Political consequences Democratic regime remained intact An implicit link: The negative effect of 1994 crisis The rise of political Islam Indirect or “postmodern” military intervention February 1997 (28 Şubat)

2000 / 2001 Crises Nature of crises Balance of payments crisis caused by Successive speculative attacks and massive outflows of capital leading to a) the collapse of growth b) heavy unemployment Both internal and external imbalances are important

Origins Disequilibrium in the banking sector Private banks in 2000 & public banks in 2001 Strong link: Disequilibria in the banking sector and fiscal imbalances

External dimension Highly volatile external environment Characterized by recurrent crisis in emerging markets & reversible capital flows especially after Asian crisis of 1997 Export performance negatively affected by the Russian crisis & weak global demand Rendered the economy highly vulnerable to a crisis

International actors in the post-crisis context IMF is the critical actor both in the pre-and post-crisis era The role of the EU decisive for the first time IMF and EU anchors are increasingly interrelated World Bank involved as a secondary actor

What went wrong between 1980 & 2001 ? There was considerable liberalization in foreign economy policy Difficulty: undertaking long-term structural reforms such as a) privatization & b) achieving the retreat of the state on the domestic front Özal’s liberalization agenda – accompanied by the expansion & concentration of the state’s economic power Public sector still dominated in the economy The creation of the out-of-budget funds (public housing & public transportation) under direct control of PM

The behavior of economic groups (reliance on import substitution policies) A new export elite prospered because of export subsidies & export promotion schemes Side payments to various interest groups - Populism a) Subsidies for the agricultural elite & b) Industrial incentives for various industrial groups, lowering of import tariffs on certain goods Crucial for building large electoral coalitions

Democratic pressures & electoral concerns increased the need for more side payments & extension of state patronage Although economic policies changed a) the institutional setting b) the nature of bureaucracy & c) the personalized, higly politicized distribution of state patronage remained intact

Payments dstributed to the constituencies Examples of side payments by existing governments: TPP (Çiller) farmers above-the-world-market base prices RPP - urban workers - wage increases TPP – WP coalition – support for the new Anatolian business community & small-to-medium-sized enterprises ANAP coalition – rising base prices for tea Populist policies resulting from; Increased political fragmentation in the parliament The need for coalition governments and frequent elections

The problem with privitization: The paradox: Liberal agenda coexisting with a state based on patronage Some success in the 1980 s Less than %10 of the privatization program’s goals in the 1990 s Turkey ranked among the worst three privatizing countries. 1987 -1997 total revenue from P did not exceed $ 3 billion Unresolved problems: Endemic fiscal deficits with inadequate tax revenues & rising external / internal debt

Significant policy contraints introduced by globalization Transformation of political economy from A protected and closed regime to An export-oriented liberal one Turkey’s economic performance in the 1990 s disappointing compared to that of the 1980 s & changes in other emerging markets

To attract a significant amount of Foreign Direct Investments (FDI) and portfolio investments To become significant players in regional and global trade Turkey became a liberal economy But not enough to push for public-sector reform & end patronagebased politics The necessity of setting up institutional framework to resolve the distributional conflicts resulting from openness and liberalization

Reasons for Turkey’s stagnant economic performance Extreme forms of popular spending & spiraling public deficits Rapid technological change The pace of financial integration The liberalization strategies adopted in 1980 s As a response to globalization pressures insufficient to reap the benefits of a highly interdependent global economy

Crucial issues: Turkey’s ability to implement institutional & public-sector reforms Turkey’s foreign economic policy: Turkey applied a liberalization strategey in its external ties This is not enough / at times counterproductive Solution: Ongoing coordination of domestic industrial strategies, technology policies, & incentive mechanisms with those of foreign economic venues To combine proactive foreign economic strategies with domestic institutional reforms and development goals

Political consequences A decisive turning point The democratic regime proved to be highly resilient (recuperating quickly) in the face of the crisis Collapse of the democratic regimes following 1958/59 & 1978/60 crises 1960 Restoration of democracy over a relatively short period of time 1980 Longer military rule Restoration of full or unrestricted party competition over a longer period

The impact of the changed international environment & The presence of a powerful EU anchor

Turkey finds itself at a crossroads After having experienced the most serious crisis in its recent history between 2000 -2001, the economy has recovered and reveals one of the highest growth levels amongst the OECD countries.

The adoption of a new institutional framework in terms of monetary and budgetary policies as well as product, labor and capital markets, including infrastructure sectors and agricultural subsidies, a path has opened up that will enable the country to free itself of three traps linked to a lack of confidence, government weakness & extreme informality in committing itself long term to the road to greater growth

This new framework of measures must be set entirely in motion and completed for it realize its full potential.