Economist Müftüoğlu: There is a need for an alternative economic program

Economist Özgür Müftüoğlu stated that an alternative and concrete economic plan should be brought up during the election process in Turkey.

Economist Özgür Müftüoğlu remarked that the Labour and Freedom Alliance should provide a paradigm that will guide the government, carry the struggle of the working class further, and express the demands of the workers and the poor. Müftüoğlu emphasized the importance of an economic plan which questions the system.

Özgür Müftüoğlu, a Labour Economics expert and economics writer, was interviewed by ANF.

Turkey’s economy has been in a crisis for a long time. How did the recent earthquakes aggravate the crisis?

It is necessary to see not the earthquake itself, but its economic, humanitarian and social repercussions as a result of the economic policies that the government has pursued so far. We have seen that the economic choices, for example, that concerned the Covid-19 pandemic, did not favour people's health. Moreover, following the earthquake, we have seen that building inspection did not respect the human factor. Resources were transferred to armament expenditures and to the capital, which allowed companies and banks to make huge profits. The result of the economic choices was revealed by the earthquakes. We could not realize it properly during the pandemic, but the earthquakes made it much more visible. At the same time, it has shown the incompetence of the government. The earthquakes showed that the government could not even meet the basic needs of the people, since it was not prepared for such disasters. Because the resources had already gone elsewhere. Now something more alarming has emerged.

It is claimed that the earthquakes caused 103 billion dollars, namely 2 trillion Turkish liras in damage. The earthquake will have a negative impact on agricultural and industrial production in the region. It seems that this will further trigger price increases. After all, there was serious agricultural production in this region. The current account deficit is well known, exports have decreased. Imports have increased tremendously. In the past, there was an improvement in the opposite direction. For instance, while export prices stood at 63 percent in January 2002, it stood at 57.6 percent in January 2023. These figures were reported before the earthquakes. So, all economic data point to a negative outlook.

How will the economy recover in the next period?

The government has introduced huge construction projects considering the election period, of course. As was the case before, the government put forward a resource transfer mechanism in favour of its cronies without paying attention to human life and disaster relief. Because of this situation, unfortunately, similar disasters will appear again in the future.

There are two aspects. On the one hand, the political situation is already known. The tenders were given quickly and the government, which could not even provide tents for 40 days, claims that it will build new houses for the survivors in a year. On the other hand, there is the opposition Nation Alliance as a serious alternative to the government. This alliance is talking about key issues, but what kind of program will be followed economically? This is not very clear. There is a financing problem to cover the loss. Who will pay for this? We are already facing a major economic crisis. We were dealing with it before the earthquake. Now, the earthquake loss has been added to this.

What are the options?

There aren't many options available. Either the government will impose the burden on large sections of society with indirect taxes and so on at the expense of further impoverishment of the workers, or it will offer a second option. It should not be forgotten that the current economic program favours cronies which have made incredible profits in all these processes, even during the pandemic. Shall we put the burden on cronies? That's the real question. When we look at the situation, the choice of the AKP and MHP government is obvious. The government is preparing to put the burden on the people. I think that the Nation Alliance does not have a very different option here.

Why is it so?

This is so because of the relevant discourses of Bilge Yılmaz, one of the economists of the IYI Party, as well as of Ali Babacan and the CHP. It shows that the economic choices of the opposition will not be much different from those of the government. They will be a continuation of the policies pursued by the ruling AKP so far. In the meantime, everyone seems to have forgotten Mehmet Şimşek's ministry, his program and its social consequences. Şimşek is portrayed as a wunderkind of economy. Unfortunately, there is an opposition that praises the economic program that Babacan, Mehmet Şimşek and the AKP have been implementing for the last 20 years.

There is no alternative to the economic program that exacerbated the pandemic, the earthquakes and the flood. Currently, we have an economic policy that cannot provide for the shelter and health care needs of society and security of life. How will this change? Will the opposition’s program really resolve the problems? I think that this point is important.

What needs to be done, what kind of plan should be adopted as the elections are looming?

I don't know if a new program will replace the old one, but as I said, there is great uncertainty about the economic program that will be implemented no matter which alliance wins the elections. There is no program put forward to prevent the working classes and the poor from getting poorer. For instance, the Labour and Freedom Alliance did not clearly reveal its policies in this sense either. Of course, it suggested a program, but it did not come up with anything that would give confidence. It is very likely that the Labour and Freedom Alliance will not come to power following the elections. However, they will be the ones who will put the most serious pressure on those who will come to power. In this sense, the Labour and Freedom Alliance should provide a paradigm that will guide the government, carry the struggle of the working class further, and express the demands of the workers and the poor. An economic plan that has no problems with the system would not work.