Contemporary Politics

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Authoritarian consolidation dynamics in Turkey

Ümit Akçay

To cite this article: Ümit Akçay (2021) Authoritarian consolidation dynamics in Turkey,
Contemporary Politics, 27:1, 79-104, DOI: 10.1080/13569775.2020.1845920

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CONTEMPORARY POLITICS
2021, VOL. 27, NO. 1, 79–104
https://doi.org/10.1080/13569775.2020.1845920

Authoritarian consolidation dynamics in Turkey

Ümit Akçay
Berlin School of Economics and Law, Berlin, Germany

ABSTRACT KEYWORDS
This paper aims to explain the key dynamics underlying the Justice Authoritarian neoliberalism;
and Development Party’s (AKP) recent authoritarian consolidation dependent financialisation;
efforts in Turkey from a critical political economy perspective structural crisis; authoritarian
consolidation; Turkey
consisting of the Regulation School’s framework and Nicos
Poulantzas’s state theory. The depoliticised mode of regulating
money, labour, and macroeconomic management worked in
parallel with introducing dependent financialisation as the
predominant capital accumulation regime between 2002 and
2013. Since 2013, however, the successive AKP governments have
struggled with the structural crisis of Turkey’s capitalism, which is
a combination of the crisis of accumulation regime and the crisis
of the state, leading to two changes: the mode of regulation has
re-politicised, and the struggle within the power bloc has
intensified. As a result, the AKP implemented more ambitious
survival strategies, and deepened authoritarianism by changing the
political regime from parliamentary to presidential system in 2018,
and initiating further authoritarian consolidation efforts in 2019.

1. Introduction
A scholarly consensus has developed recently that describes Turkey’s current political
regime as non-democratic, particularly after Freedom House (2018) downgraded
Turkey’s status from ‘Partly Free’ to ‘Not Free’ in 2018. According to Tansel (2018), this con-
sensus came after ‘a rude awakening’ for many scholars, who had viewed the first term in
government of the Justice and Development Party (AKP) between 2002 and 2007 as a
democratisation process, with the AKP as the leading democratising actor against the
tutelage regime of Turkey’s Kemalist establishment. These scholars tend to see a clear dis-
continuity in the between the AKP government’s first and later terms, as if they were two
completely different political players. This makes the Turkish case particularly puzzling
from a comparative perspective because, unlike in Poland, Hungary, or India for
example, the same political party held power both before and after the ‘authoritarian
turn’. Bermeo (2016, p. 5) categorises Turkey as a case of ‘democratic backsliding’,
meaning a deliberate state project that aims to hollow out the institutional foundations
of a democracy. She further suggests the dominant form of democratic backsliding in
Turkey has been ‘executive aggrandizement’ whereby ‘elected executives weaken
checks on executive power one by one, undertaking a series of institutional

CONTACT Ümit Akçay Uemit.Akcay@hwr-berlin.de

© 2020 Informa UK Limited, trading as Taylor & Francis Group
80 Ü. AKÇAY

changes that hamper the power of opposition forces to challenge executive prefer-
ences’ (Bermeo, 2016, p. 11). Levitsky and Way (2010, p. 5) describe the ‘competitive
authoritarianism’ as a political regime in which ‘formal democratic institutions exist
and are widely used as the primary means of gaining power, but in which incumbents’
abuse of the state places them at a significant advantage vis-à-vis their opponents’.
According to their definition, there is still room for the opposition but the competition
between the incumbent and the opposition is essentially unfair. Özbudun (2015)
implements this concept to Turkey with a particular focus on the changing functions
of the judiciary and the High Courts after the constitutional amendment of 2010 as
part of the formation of the competitive authoritarian regime of the AKP. Esen and
Gumuscu (2016) expand this line of argument and implement it to the post-2015
period by describing the main elements of the new political regime of Turkey. Later
on, Levitsky and Way’s (2010) conceptual framework became the mainstream character-
isation of Turkey’s current political regime in Turkey’s liberal political science scholarship
(Castaldo, 2018; Çalışkan, 2018; Somer, 2016). The striking aspect of this burgeoning lit-
erature is its relative lack of causal explanations for the AKP’s supposed authoritarian
turn. Instead, scholars have mostly focused on listing the AKP’s negative track record
regarding the rule of law, freedom of expression, and other fundamental rights, as if
ticking off the checklist defining ‘competitive authoritarianism’.1
The Turkish case is not only puzzling for mainstream liberal political science scholar-
ship but also for critical comparative political economy perspectives. Critical scholars
are also struggling to develop a comprehensive framework to explain why and how
the AKP government shifted its power strategies between the first and subsequent
terms. Instead of the ‘democratic backsliding’ or ‘competitive authoritarianism’ frame-
works, critical scholars tend to underline the continuity and intensification of the author-
itarian tendencies within the authoritarian statism under the AKP governments. Akça
(2014), for instance, points out the continuation of the authoritarian state form since
1982, when a new constitution was introduced after the military coup of 1980, and he
explains the particular character of the AKP’s hegemonic project, which consisted of neo-
liberalism, conservatism and authoritarian populism. He also argues that the ‘civilianiza-
tion’ process that was initiated by the AKP through using the EU membership
requirements as a leverage against the old Kemalist establishment between 2002 and
2007, which was initially celebrated as a democratisation, actually was part of the AKP’s
strategy for conquering the state. Özden et al. (2017) argue that although the authoritar-
ian state form has been persistent during the AKP rule, the AKP’s political strategy has
changed from an expansive to a limited hegemony, which required the condensation
of authoritarianism. Furthermore, Bozkurt-Güngen (2018) and Erol (2018) highlight the
significance of introduction of flexibilization of labour market reforms via amendments
in the Labor Code in 2003 as one of the key dynamics of consolidation of the authoritarian
labour regime in Turkey during the first term of the AKP. Adaman and Akbulut (2020, p. 3)
also disagree with the understanding of ‘the AKP era as a clear duality in terms of democ-
racy and civil rights vs. authoritarianism’, rather they align themselves with ‘those who
argue that the AKP rule has carried an element of authoritarianism all along, the intensity
of which continues to increase exponentially’. They emphasise that the authoritarian
character of the AKP’s neoliberalism consisted of a combination of populism and
developmentalism.2
 CONTEMPORARY POLITICS 81

To contribute to this debate, I propose an alternative explanation based on causal ana-

lyses. My theoretical approach is grounded in a particular branch of the critical political
economy perspective, namely the Regulation School’s framework and Nicos Poulantzas’s
state theory. The two main focuses of the article are understanding the main character-
istics of the AKP’s 18-year rule, and explaining the key dynamics of the Erdoğan adminis-
tration’s recent ‘authoritarian consolidation’ efforts. To serve this purpose, this paper is
centred around the following questions: How did a seemingly democratising party turn
into the key authoritarian force in a short period of time? To what extent are descriptive
concepts, i.e. competitive authoritarianism, equipped with the relevant analytical tools to
uncover the structural causes of the ‘authoritarian turn’? How and why did Turkey’s depo-
liticised and technocratic state structure repoliticize? How did the AKP increase its elec-
toral support although it implemented harsh neoliberal reforms, and in which way it
manages to stay in power even though its electoral support started to decline? What
are the main dynamics of the authoritarian consolidation attempt of the Erdoğan
administration?
I suggest that the AKP rule can be analysed in two periods: the establishment of
authoritarian neoliberalism and the structural crisis of Turkish capitalism. In its first
term, the AKP government implemented depoliticised macroeconomic management,
guided by an existing IMF programme. This depoliticisation strategy involved the destruc-
tion of Turkey’s organised labour while its modes of regulating money, labour, and macro-
economic orchestration worked in parallel with introducing dependent financialization as
the predominant capital accumulation regime between 2002 and 2013. In short, the key
characteristic of the AKP governments until 2013 was authoritarian neoliberalism. I argue
that a change in the regulation of wage/labour relations during the early 2000s was one of
the critical enabling factors in developing authoritarian neoliberalism and thereby chan-
ging the structure of political struggle in Turkey. Social inclusion of the poor through a
newly established limited welfare regime and financial inclusion through mass-based
financialization functioned as a dual compensation mechanism during this period
(Akcay, 2018).
Since 2013, however, successive the AKP governments have struggled with a structural
crisis, which is a combination of the crisis of Turkey’s accumulation regime and the crisis of
the state. This structural crisis of Turkey’s capitalism has paved the way for two changes.
First, the mode of regulation has changed and economic management has been re-poli-
ticized, including the use of non-orthodox measures. The government has increased its
involvement in the economy by expanding its regulatory authority, using public banks
as a counter-cyclical tool, and establishing a sovereign wealth fund to increase its inter-
vention capacity. Second, it has intensified the struggle within the power bloc, which
has forced Turkey’s political elites to implement more ambitious survival strategies.
This is the main reason for a deepening of authoritarianism, particularly the change
from a parliamentary to executive presidential system in 2018 and further authoritarian
consolidation efforts in 2019.
After briefly summarising the main theoretical ground in the second section, the rest of
the paper is devoted to explaining the main dynamics of rising authoritarian neoliberal-
ism during the early 2000s, the post-2013 structural crisis, and the authoritarian consoli-
dation efforts by the AKP’s leader, and Turkey’s President, Recep Tayyip Erdoğan.
82 Ü. AKÇAY

2. Accumulation regime, mode of regulation, and structural crisis

Aglietta (2015 [1979]), one of the founding scholars of the Regulation School (RS), sum-
marises the basic insights of RS as the realisation that capitalist social relations of pro-
duction and reproduction are inherently unstable and destined for crises. Therefore,
regulation is the key component for producing and reproducing capitalist social relations.
Broadly, regulation refers to political, economic, institutional, legal, and societal mechan-
isms that counter crises of capitalist accumulation. Thus, RS rejects the idea of self-regu-
lating and self-stabilising markets, and assumes that a market society requires state
involvement to survive (Boyer, 1990). One of the fundamental aspects of RS is its holistic
analyses of the social formation by examining its political, institutional, and economic fea-
tures as parts of an integral whole. Another value of RS is its focus on the ‘historical spe-
cificities of capitalism’ (Jessop & Sum, 2006, p. 4) and the horizontal (intra-class) and
vertical (inter-class) class struggles that create these historical specificities. RS can there-
fore be considered a middle-range theory (Brenner & Glick, 1991), which pays more atten-
tion to the mechanisms and tendencies that create both stability and crisis.
The concept of the capital accumulation regime is one of the key analytical tools that
RS uses to explain the fundamental dynamics of a political-economic model within a
specific social formation in a particular time period. According to Boyer (1987, p. 9),
a regime of accumulation is defined by the whole set of regularities which allow a general and
more or less consistent evaluation for capital formation, i.e. which dampen and spread over
time the imbalances which permanently arise from the process itself.

The concept aims to explain the main characteristics of an economic growth model by
linking changes in the main macroeconomic indicators to horizontal (intra-class) and ver-
tical (inter-class) class struggles.
Pioneer RS theorists identified two broad capital accumulation regimes in relation to
the post-1945 period in the US and Europe: Fordism and post-Fordism. While the
former focuses on the period between 1945 and 1980, characterised by relatively
stable economic growth, the latter refers to the post-1980 period, characterised by sub-
stantial global changes in production and monetary systems in response to the structural
crisis of the Fordist accumulation regime (Lipietz, 1988). Boyer (2000), in his recent works,
combines the capital accumulation regimes with the financialization debate to argue that
the latest form that has developed in the neoliberal era is the finance-led accumulation
regime, alongside other types like competition-led, export-led, or service-led regimes.
More recently Hein et al. (2020) suggest that four main regimes can be identified in the
mature capitalist countries: (1) an export-led mercantilist regime, (2) a weakly export-
led regime, (3) a domestic demand-led regime, and (4) a debt-led private demand
boom regime. Following this line, I will argue that Turkey’s accumulation regime since
1989 can best be described as dependent financialization.3
Mode of regulation is another key concept that links the growth models to the state
forms, which are determined by the power balance in the power bloc comprised of the
bourgeoisie, bureaucracy, and political class. It basically describes the state’s role in the
economy and the character of the state’s institutional settings. Stable capital accumu-
lation requires harmonisation between the accumulation regime and the mode of regu-
lation of economy. Lipietz (1988, pp. 24–25), defines three primary forms of regulation:
 CONTEMPORARY POLITICS 83

regulation of wage relations, regulation of money, and general macroeconomic manage-

ment. I will follow Lipietz’s categorisation to analyse Turkey’s recent political economy.
Capital accumulation regimes and their accompanying modes of regulations are estab-
lished through inter-class and intra-class struggles. The framework developed by political
theorist Poulantzas (2008), particularly the concept of ‘power bloc’, is helpful to uncover
the main dynamics of a particular accumulation regime and its complementary insti-
tutions. I have slightly modified the concept to operationalise it for the Turkish context.
In this adjusted account, the power bloc includes (i) the political class, i.e. political
parties, (ii) the bourgeoisie and different capital fractions, and (iii) the institutional struc-
ture of the state, i.e. the bureaucracy. Although there is no simple chain of command
linking the dominant capital faction of capital with other sections of the power bloc,
the dominant capital fraction has the superior position in the bloc because economic
growth mostly comes from private sector investments in capitalist economies. Neverthe-
less, this superior position does not automatically guaranty the hegemony of this capital
fraction. The dominant capital fraction can only become dominant if it can successfully
present its interests as the general interest of capital (Jessop, 1985).
In contrast to cyclical crises (i.e. normal business cycles), structural crises are disruptions
for both accumulation regimes and their modes of regulation (Boyer & Saillard, 2005,
p. 43). Similarly, according to Poulantzas (2008, p. 299), the unique aspect of a structural
crisis is that the accumulation crisis and the state crisis overlap. Nevertheless, Jessop
(1985, p. 93) urges that ‘crisis alone explains little’. The modalities of class struggle and
class strategies will shape the form of the state or the type of the regime. Hence, the
crisis management became one of the key areas of class struggle during the structural
crises because it is the area of condensation of various competing strategies of
different social classes or class fractions. Through his concept of ‘the crisis of crisis man-
agement’, Offe (1976) provides an analytical framework to explain how structural crises
generate dilemmas for state managers, particularly focusing on the structural crisis
dynamics of the welfare state model in the late 1970s. This is particularly important for
explaining how structural crises in turn cause serious dilemmas for state managers.
Hence, structural crises generally result in substantial changes to the accumulation
regimes, modes of regulation, and state forms (Boyer, 2018).
In this study, I am concerned with a more general question that RS seeks to answer:
‘how capitalism could survive even though the capital relation itself inevitably generated
antagonisms and crises that made continuing accumulation improbable’ (Jessop & Sum,
2006, p. 123). I seek answers to this general question in the Turkish context by analysing
the interconnected nature of the political and economic dynamics that have generated 18
years of the AKP rule. More specifically, I aim to explain the main dynamics underlying the
Erdoğan administration’s recent authoritarian consolidation efforts by locating them
within the theoretical context that I briefly summarised in this section.

3. Establishment of authoritarian neoliberalism in Turkey (2002–2013)

The AKP first took power in the 2002 elections following the severe economic crisis of
2001, which wiped out all the political parties that had been represented in parliament
till then. After separating from Turkey’s traditional political Islamist movement, the AKP
defined itself as a conservative democratic party. The key differences between the AKP
84 Ü. AKÇAY

and the political Islam tradition were the former’s adoption of neoliberalism as its econ-
omic policy framework and its pro-Western orientation (Tuğal, 2009).
The AKP adroitly exploited Turkey’s European Union (EU) membership accession
process and the IMF programme as crucial leverage against Turkey’s Republican, Kemalist
establishment, concentrated in the Turkish military and the higher courts. The EU acces-
sion, which prioritised establishing the rule of law and supported civilian politics, was par-
ticularly useful for undermining the military’s role in Turkey’s political system (David,
2016). The IMF programme, the AKP’s other leverage, was not merely a stand-by agree-
ment. Rather, it required more substantial changes towards establishing a new regulatory
state structure in line with the Post-Washington Consensus (Öniş & Şenses, 2005).
I argue that the state restructuring project of the early 2000s was the key that enabled
the AKP to establish an authoritarian neoliberal model, based on a depoliticised, techno-
cratic macroeconomic management structure and weakening organised labour. In Pou-
lantzas’s terms, authoritarian neoliberalism4 is an updated version of authoritarian
statism. He introduces this concept to describe the general trend in the late 1970s in
advanced capitalist countries of declining democracy, particularly parliaments, and a
strengthening of executive power (Poulantzas, 2000). More recently, Bruff (2014, p. 115)
argues that authoritarianism needs to be understood not only as an ‘exercise of brute
coercive force’ but as a state restructuring that aims to ‘insulate certain policies and insti-
tutional practices from social and political dissent’. Following this line of critical scholar-
ship, I will first describe the main characteristics of the accumulation regime and its
corresponding mode of regulation in order to explain the main dynamics underlying
the establishment of authoritarian neoliberalism in Turkey.

3.1. Dependent financialization

After the 2001 crisis, Turkey’s accumulation regime was shaped by an IMF programme
that aimed to curb inflation through an Inflation Targeting (IT) policy framework. Accord-
ing to Akyüz and Boratav (2003, p. 1555), this crisis belongs in the same wave of financial
crises of the late 1990s a common crisis mechanism: ‘a surge in capital inflows, an upturn
in economic activity, a significant appreciation of the currency, mounting trade deficits,
worsening balance sheets and rising exchange rate risks’. The first step in the new IMF
programme was abolishing exchange rate controls and letting the Turkish Lira (TL)
float freely. Second, the programme required high interest rates as the main policy tool
for controlling inflation while severe austerity measures and a tight monetary policy
were imposed to reduce public debt. Simultaneously, Turkey benefitted from expansion-
ary monetary policies in the United States and Europe in the early 2000s that fuelled
capital flows into emerging countries. However, alongside the internal contradictions of
Turkey’s dependent financialization regime, the main vulnerability was relying on such
capital inflows for economic growth.
For instance, one consequence was appreciation of the national currency, which in turn
boosted imports. Cheap imports undermined existing production structures in agriculture
and industry, and increased foreign dependence. Therefore, two shortcomings of this new
accumulation regime were ‘premature deindustrialization’ (Rodrik, 2015) and a high
current account deficit. To stimulate economic growth in the wake of the 2008–2009
Global Financial Crisis (GFC), the AKP government allowed non-financial corporations
 CONTEMPORARY POLITICS 85

to borrow in foreign currencies, which caused firms to quickly increase their foreign
exchange debt (Akcay & Güngen, 2019). Between 2008 and 2013, Turkey had the
fastest increase in private indebtedness of emerging countries (Akyüz, 2015, p. 45).
Dependency on capital inflows was not the only problem of dependent financialization
(Becker, 2016). The financialization experiences of peripheral or semi-peripheral countries
bear the stamp of their ‘peripheral condition’ (Andrade & Prates, 2013). Specifically, lower
level of convertibility of their national currencies encourages dollarisation or euroization
(Becker et al., 2010, p. 230) and forces peripheral countries’ central banks to offer higher
interest rates to international investors to attract capital inflows (Gabor, 2018). Since the
international monetary regime is built on the supremacy of the US dollar, this hierarchy
reinforces the peripheral condition. Thus, one of the main dilemmas for peripheral or
semi-peripheral countries is their need to offer higher interest rates while securing
financial stability without harming economic growth. After 2013, the AKP governments
continuously faced this dilemma, which can be defined as the crisis of crisis management.
Dependent financialization developed in three periods in Turkey. The first period
(between 1989 and 2001) was characterised by the need to roll over state debt. The
second period (between 2002 and 2013) was marked by mass-based financialization,
drawing the poor into the financial system, and increasing non-financial corporations’
indebtedness. This period is particularly important for the formation of authoritarian neo-
liberalism because ‘privatized Keynesianism’ became an available tool for Turkish policy-
makers for the first time. This concept, coined by Crouch (2009), highlights the increasing
importance of household debt. In the neoliberal era, he argues, ‘instead of governments
taking on debt to stimulate the economy, individuals did so’ (Crouch, 2009, p. 390). This
helped sustain political support for the government, even when it was implementing an
austerity policy, because the availability of loans to lower income groups increased their
purchasing power when real wages were not rising (Karacimen, 2015). During Turkey’s
mass-based financialization period, ratio of household debt to GDP increased more
than 10-fold, from 1.8% in 2002–19.6% in 2013 (Akcay, 2018).
However, mass-based financialization requires low interest rates, which depend on
uninterrupted capital inflows (Akcay & Güngen, 2019). Consequently, any changes in
the international financial regime, particularly policy decisions by the Fed, the US
central bank, would affect Turkey’s accumulation regime. Indeed, in May 2013, the
Fed announced an increase in interest rates and a reduction in its balance sheet (Finan-
cial Times, 2013). Defining the start of the third period of dependent financialization in
Turkey, this decision turned the internal contradictions of the accumulation regime into
a structural crisis. The main contradictions were the rising sensitivity of economic growth
to capital movements, and the growing foreign exchange indebtedness of Turkey’s
nonfinancial corporations. Before explaining in detail how this long-lasting structural
crisis of Turkey’s capitalism developed, I would like to elaborate more on the mode of
regulation corresponding to the dependent financialization regime.

3.2. Depoliticisation, marginalisation of organised labour, and the new welfare

regime
The 2001 IMF programme required, among other conditions a new mode of regulation, in
which depoliticisation of economic management was the key strategy. Depoliticisation
86 Ü. AKÇAY

can simply be defined ‘as the process of placing at one remove the politically contested
character of governing’ (Burnham, 2001, p. 128). Kemal Derviş (2001), former Vice Presi-
dent of the World Bank, who was invited to Turkey to become Minister of the Economy
after the 2001 crisis, summarised this strategy clearly: ‘politics has highly interfered
with economics in Turkey. We must separate economics and politics.’
According to Burnham (2001, p. 129), governments seek to obtain two benefits
through depoliticisation: (i) ‘to change market expectations regarding the effectiveness
and credibility of policy-making’; (ii) ‘shielding the government from the consequences
of unpopular policies’. Regarding this mode of regulation in Turkey, we can add two
further essential conditions: exclusion of the subaltern classes from decision making
and increasing the power of the executive branch over the legislative. Turkey’s previous
coalition government had taken two other essential steps to depoliticise economic man-
agement by making the central bank independent of the government (Akçay, 2009) and
forming independent regulatory institutions (Atiyas, 2012). AKP not only embraced this
new strategy but also reinforced it in its first term.
Regarding the mode of regulation of wage-labour relations, a fundamental change was
the new Labor Code of 2003, which introduced more flexible hiring and firing conditions
for employers (Erol, 2018), legalised subcontracting relations, and undermined job secur-
ity through limited-term contracts (Bozkurt-Güngen, 2018). Additionally, this successfully
implemented privatisation programme had two critical effects. First, by reducing public
spending and providing revenue for the state budget, the privatizations were central
to the austerity programme. Second, privatising State-Owned Enterprises was politically
important because they were strongholds of the organised labour. The privatizations era-
dicated the most militant sections of Turkey’s organised labour, who had stopped priva-
tizations during the 1990s. The result was dramatic: trade union density in Turkey
decreased from 29.1% in 2001–6.3% in 2015 (OECD, 2017). Since then, the organised
labour has remained, politically and economically, a marginal actor (Özkiziltan, 2019).
Although such severe measures might be expected to undermine the incumbent
party’s electoral support, the AKP’s election performances continued improving until
2015. This was possible because the government absorbed potential opposition to its
neoliberal programme by establishing a new welfare regime (Özdemir, 2020). In compari-
son with the previous regime, which had only covered relatively privileged groups, e.g.
industrial workers and civil servants (Buğra & Candaş, 2011; Özden, 2014), AKP’s new
social policies were more inclusive and better funded (Buğra, 2020, p. 7).
One of the most important components of the new welfare regime was the Conditional
Cash Transfers program, supported by the World Bank and covering almost 10 million
people per year by 2011 (Özden & Bekmen, 2015, p. 93). This more inclusive regime
was also instrumental for managing the poor (Yörük, 2012). Social support programmes
were carefully designed to earn the electorate’s political support while state institutions
responsible for allocating cash transfers had large discretionary power (Bozkurt, 2013;
Eder, 2010). During the AKP governments, ‘the shares of voluntary public and private
transfers in the incomes of households have been rising’ particularly for ‘rural unem-
ployed, urban unemployed and agricultural labourers’ (Bahçe & Köse, 2017, p. 575). As
Buğra and Keyder (2006, p. 226) note, the regime was also highly political in that it had
‘a conservative-liberal tendency, whereby Islamic notions of charity successfully comp-
lement attempts at downsizing the state through strict controls over social spending’.
 CONTEMPORARY POLITICS 87

Figure 1. Gini index of disposable income during the AKP governments (2002–2018).
Reference: Prepared by the author from the standardised world income inequality database, (accessed on 30 September
2020 at https://fsolt.org/swiid/).

Until the structural crisis period, the poverty rate was declining in Turkey mostly
because of the economic growth rather than changes in inequality (Şeker & Jenkins,
2015). The declining trend in poverty slowed down and there has been even an increase
in the number of people living under the national poverty line in the post-2013 period
(World Bank, 2020). The changes in the inequality trend, which can be seen in the Gini
Index (Figure 1), were similar to that of poverty throughout the AKP governments.
While in the first period of the AKP government the Index value gradually declined,
which indicates a trend towards greater equality, inequality started to increase particu-
larly after 2013 (see Figure 1).
Regarding the improvements in income inequality before 2013, the increase in the
public social expenditure was one of the crucial factors. Indeed, the public social expen-
diture doubled between 2002 and 2014, although it is still almost half of the average of
OECD countries (Dorlach, 2020, p. 2). In contrast to the democratic middle-income
countries, development of the new welfare regime is coupled with the marginalisation
of organised labour in Turkey. This implies that the new welfare regime was established
as part of a new labour control regime of the AKP (Bahçe & Köse, 2017). Persistent high
unemployment, 10.5% on average between 2005 and July 2020 (Turkstat, 2020a), and
the declining albeit still high presence of informal sector (Başlevent & Acar, 2016) were
other important factors that have further undermined the organisation capacity of
labour and functioned as additional dynamics of the new labour control regime. Regard-
ing the deterioration in income inequality after 2013, Yilmaz and Sefil-Tansever (2019,
p. 1123) argue that one reason for the increasing inequality may be the GFC, whose
burden ‘was entirely placed on the lower- and middle income groups’. As I will elaborate
below, however, the main cause for this deterioration was the structural crisis of Turkey’s
capitalism, which manifested itself as the crisis of dependent financialization model of
the AKP.
Authoritarian neoliberalism, therefore, was established in Turkey during the 2000s
through (i) the formation of a new technocratic macroeconomic management structure;
88 Ü. AKÇAY

(ii) enfeeblement of organised labour; (iii) the creation of a new welfare system designed
to absorb potential opposition. Based on changes in the mode of regulation of money,
labour, and the state’s general macroeconomic management, I argue that authoritarian
neoliberalism also changed the structure of political struggle in Turkey. That is, there is
a causal relationship between weakening organised labour, which had been the most
vibrant opposition force in Turkey during the 1990s, and intensified struggles within
the power bloc. In other words, authoritarian neoliberalism did not eliminate political
conflict; rather, ‘it … merely shifted its locus upward, from the workplace and neighbor-
hoods to the upper echelons of the political class’ (Akcay, 2018, p. 180).

4. Structural crisis of Turkey’s capitalism (2013–2019)

The GFC in 2008 was a turning point because it unleashed discontent against neoliberal-
ism, not only in the US and Europe, but also in the Global South. Right-wing populist
forces have strengthened since then, particularly in countries with weak labour move-
ments and ineffective Leftist politics. Jayasuriya (2020) contends that the authoritarian
neoliberalism of the 1990s and early 2000s and the technocratic management strategies
of the Washington Consensus created a legitimacy crisis that right-wing populist forces
capitalised on in Southeast Asian countries like Indonesia, the Philippines, and Thailand.
Likewise, Narendra Modi and his Hindu nationalist Bharatiya Janata Party government
took power in 2014 in India after a series of Congress Party-led governments (Chacko,
2018). Similarly, in 2015, Poland’s right-wing populist Law and Justice government
became the first party since 1989 to form a one-party government, after three waves of
market reforms (Shields, 2015, 2019).
For Turkey, the turning point was 2013. Not because the accumulation regime was
challenged by the Fed’s signals to raise interest rates but because the state crisis
erupted the same year with the Gezi Park protests5 and the intensifying clash between
the AKP and the Gülen movement.6 The crisis of the accumulation regime went hand
in hand with the erosion of the technocratic mode of regulation. Since 2013, the prevail-
ing mode of regulation has been re-politicization while discretion-based policymaking
became the mainstream.
The political elite’s survival strategies intensified the political struggle within the power
bloc while the crisis of the accumulation regime fuelled further this intense battle. One
result of this structural crisis was a change in the political regime from a parliamentary
to executive presidential system in 2018. Another was the Erdoğan administration’s
authoritarian consolidation efforts during 2019. As before, the following section elabor-
ates first on the crisis of the accumulation regime during this period before focusing
on changes in the mode of regulation as part of the re-politicization of economic
management.

4.1. Crisis of dependent financialization

As the international financial cycle changed from expansion to contraction, which
occurred after the Fed’s monetary policy decisions in 2013, it seriously affected emerging
capitalist countries (ECCs) (Eichengreen & Gupta, 2015; Rey, 2015). The external enabling
conditions for domestic financialization were reversed, creating a serious dilemma for the
 CONTEMPORARY POLITICS 89

Figure 2. Turkey’s GDP growth rate during the structural crisis Period (2013–2019).
Reference: Prepared by the author from Turkish statistical institute, national accounts, (accessed on 30 April 2020 at
http://www.turkstat.gov.tr/UstMenu.do?metod=temelist).

AKP government: it was now impossible to reduce interest rates to stimulate the econ-
omic growth and stabilise the TL’s value against the US dollar because of slowing
capital inflows. Thus, the decline in capital inflows was a key dynamic underlying the
crisis in Turkey’s debt-driven accumulation regime.
The structural crisis unfolded as three economic contractions during 2014-II, 2016-III,
and 2018-II-III-IV, as shown in Figure 2. These contractions also reflect the state crisis (in
other words, authoritarianization) in the economy. Turkish policymakers were able to
cope with the first economic contraction in 2014 because capital inflows briefly increased,
primarily after the European Central Bank introduced negative interest rates to boost
economic growth in Europe (Irwin, 2014). When the second contraction hit the Turkish
economy, after the failed coup attempt in 2016, the AKP mobilised Turkey’s public
banks to generate a huge credit expansion cycle. However, the economic situation dete-
riorated rapidly after the new presidential system was implemented in June 2018 as it
abolished the separation of powers and centralised power in the hands of the executive
branch and the president.
Two months following this transition, a currency crisis erupted in August 2018 due to
an escalating foreign policy conflict between Turkey and the US. TL lost 40% of its value
between January and August 2018 (Akçay & Güngen, 2018). The currency crisis was fol-
lowed by skyrocketing inflation due to the exchange rate pass-through mechanism. In
one month, the central bank was forced to increase interest rates dramatically, which
inevitably resulted in a credit crunch and then a recession. Four months after the currency
crisis, economic activity had slowed down radically, leading to a huge adjustment in
Turkey’s current account balance (see Figure 3).
Policymakers took four measures during the crisis. First, they stabilised TL, primarily
through an interest rate hike. However, three additional factors played an important
role for TL’s stabilisation: (i) the Fed’s changing monetary policy; (ii) the collapse of
90 Ü. AKÇAY

Figure 3. Turkey’s current account balance (1996–2019).

Reference: Prepared by the author from Central Bank of Republic of Turkey, balance of payments and related statistics,
EVDS, (accessed on 30 April 2020 at https://www.tcmb.gov.tr/wps/wcm/connect/EN/TCMB+EN/Main+Menu/Statistics/
Balance+of+Payments+and+Related+Statistics).

imports; and (iii) government intervention in the markets through squeezing TL liquidity
in off-shore markets (Devranoglu & Butler, 2019) and selling foreign exchange reserves
(Spicer & Sezer, 2020). The second measure involved debt restructuring, especially for
companies with foreign exchange denominated debt. Third, to motivate companies to
invest in highly import dependent sectors, the government introduced a quasi-import
substitution programme to offset the collapse in imports due to the currency crisis
(UNCTAD, 2019). Although the Turkish economy gradually began to recover (see Figure
2), robust economic growth remains unlikely in the near future. One of the key damaging
results of the crisis was rising unemployment. Immediately after the currency crisis, it
jumped, mostly due to the collapse of the construction and housing sectors, and was
still high (13.6%) in February 2020 (Turkstat, 2020b).
The crisis of dependent financialization also hit construction, transportation and
energy sectors, along with the mega infrastructure projects, which have been the key
areas for Erdoğan governments both economically and politically (Adaman et al., 2019;
Adaman & Akbulut, 2020; Erensü, 2018). Construction projects were particularly important
because, first of all, they were seen as a temporary solution to absorb the migration from
the countryside to the cities as the share of agriculture in the GDP declined during the
2000s (Orhangazi & Yeldan, 2020). Second, the AKP governments used these sectors as
a tool to create loyal business groups via distributing lucrative contracts and public guar-
anties (Ocaklı, 2018). Finally, these projects functioned as means of distributing rent,
which served as an informal mechanism to support the urban population (Tekgüç,
2018). However, since the construction sector has been highly dependent on imported
goods and cheap loans, therefore on low interest rates, 2018–2019 crisis severely
 CONTEMPORARY POLITICS 91

affected the sector. Hence, rebounding the sector became one of the key strategic goals
of Erdoğan governments, and this created a systemic pressure to keep the interest rates
low as much as possible.

4.2. Crisis of crisis management and repoliticization

The main dynamic underlying the crisis of crisis management facing the AKP government
after 2013 was intensified conflicts within the power bloc. More specifically, the state crisis
and accumulation regime crisis overlapped while the structural crisis of Turkey’s capital-
ism also involved a crisis of authoritarian neoliberalism. Thus, authoritarian neoliberalism
had become fragile both because of its accumulation model, and because ‘the processes
of disincorporation lead to increasingly difficult management of class relations – a crisis of
crisis management’ (Jayasuriya, 2018, p. 591). The structural crisis period and its accom-
panying crisis of crisis management were key drivers of the Erdoğan government’s
attempt at authoritarian consolidation in 2019.
Around the time of the GFC, the mode of regulation in Turkey changed towards repo-
liticization. Unsurprisingly, Turkey was not a unique case (Dönmez & Zemandl, 2019) since
neoliberal technocratic governance strategies were being seriously challenged or even
collapsing in many countries in the post-GFC period. Despite growing dissatisfaction
among the masses with the neoliberal technocratic structures and austerity policies,
and protest movements worldwide in reaction to the GFC, depoliticisation remained
the mainstream strategy in the EU (Burnham, 2014). Interestingly, the Central and
Eastern Europe Countries (CEEC) have not followed this mainstream strategy. For instance,
Orenstein and Bugarič (2020, p. 6) underline that ‘Hungary became the first CEEC to reject
neoliberalism and experiment with nationalist populism’, while nationalist conservatives
followed a similar path after they came to power in 2015 in Poland. Bluhm and Varga
(2020) also argue that the GFC was a turning point for shifting towards establishment
of ‘conservative development states’ in Hungary, Poland and Russia. Repoliticization
has been the main strategy of the right wing populists, as the social democrats mostly
committed to the rule-based technocratic governance strategies and to the EU regu-
lations in CEEC. Hopkin and Blyth (2019, p. 207) expand this focus from CEEC to the Euro-
pean scale and highlight that the rising right wing populists tend to ‘demand a less
restrictive and more interventionist approach’. In a similar vein, Worth (2013, 2015)
argues that the repoliticization trend can be seen as an element of the far-right’s political
programme that developed against the rule-based technocratic structure and the neolib-
eral economic globalisation. This political cleavage can also be observed in Turkish politics
when the AKP shifted towards repoliticization after the GFC and particularly after the post-
2013 period, when the structural crisis of Turkish capitalism led the AKP to search for a
new growth model.
The depoliticised mode of regulation, which had been effective during the AKP’s first
term in government, was based on the central bank’s independence from political auth-
ority, an inflation targeting policy framework, and independent regulatory bodies.
However, after the GFC, this mode of regulation gradually changed as Turkey’s regulatory
bodies gradually lost their independence (Özel, 2012), particularly the central bank (BBC,
2019). Repoliticization became an option for the AKP, particularly when Turkey lost the
external anchor provided by the IMF agreement, which ended in 2008. However, it did
92 Ü. AKÇAY

not materialise until 2011. In 2008, for example, Ali Babacan, then deputy prime minister
responsible for economic coordination among ministers, announced that Turkey should
continue to work with the IMF despite no longer needing its funding because the IMF
‘brings aspects of transparency. It does bring a good in a way, outside monitoring mech-
anism, and it does help us to strengthen the confidence in the country, in the economy’
(Financial Times, 2008). For two years, Turkey negotiated with the IMF over a new agree-
ment but talks ended in 2010 with no new agreement (Financial Times, 2010). This period
also marked the transition of the mode of regulation to repoliticization in Turkey.
In 2011, however, Babacan reversed course by announcing that ‘auto-pilot [techno-
cratic management] is absolutely out of question. It cannot happen in these times. We
have to manually adjust our policies according to monthly, daily even hourly develop-
ments’ (Hurriyet, 2011). In line with this latest orientation, he also declared that the gov-
ernment was working on a proposal to delegate the independent regulatory agencies’
authority to the relevant ministries on the basis that the government had political respon-
sibility for the decisions of these supposedly independent bodies (BloombergHT, 2011).
Consequently, already in 2011 the ‘AKP governments increased their control over the
regulatory agencies’ by limiting their authority (Özel, 2015, p. 5).
The repoliticization strategy was consolidated after 2013 due to the structural crisis of
Turkey’s capitalism. Repoliticization became rational for the government because it
realised that crises had repeatedly interrupted the existing accumulation regime since
2013. In addition, adopting the new super-presidency system required centralisation of
political power around the presidency. The latter factor became even more important
during the state crisis, which Erdoğan’s government saw as an existential threat to its rule.

5. Authoritarian consolidation attempt (post-2019 period)

Lührmann and Lindberg (2019, p. 1105) argue that the recent autocratization wave differs
from the previous two because, in the former, ‘incumbents legally access power and then
gradually, but substantially, undermine democratic norms without abolishing key demo-
cratic institutions’. Turkey mirrors this global trend. As Yılmaz and Turner (2019, p. 693)
observe, there has been ‘an accelerating pattern of authoritarian responses to increasing
social and political instability as the AKP struggles to control and overcome the issues
facing its continuity’. The crisis of the state first erupted in 2007 during the presidential elec-
tions, and it has been intensifying in tandem with the crisis of the accumulation regime since
2013. Previously, between 2007 and 2013, the main struggle within the power bloc was
between the political elite (the AKP government) and the old Republican bureaucracy.7
However, once the AKP successfully eliminated the old secularist fraction of the bureaucracy
with the help of the Gülenists, a second round of the battle within the state started. This time,
the AKP and the Gülenists, who had fought together against the old Republican ‘tutelage
regime’, turned on each other in a ruthless struggle to control all state power. From 17 to
25 December 2013, the state structure was seriously shaken when the Gülenist persecutors
opened court cases against Erdoğan’s government over corruption and bribery allegations.
The government fought back by purging the Gülenists from the judiciary and security forces.
The latest round in this struggle was the attempted coup on 15 July 2016 (Bargu, 2018).
After it failed, a State of Emergency was declared, under which an AKP and the far-right
Nationalist Action Party (MHP) alliance won the 2017 constitutional referendum to change
 CONTEMPORARY POLITICS 93

the regime from a parliamentary to presidential system (Yılmaz, 2020). The transition to the
new regime was completed when Erdoğan, as the candidate of the AKP and the MHP alliance,
won the 2018 presidential election. These developments reflect the point made by Göbel
(2011, p. 181) that ‘just like their democratic counterparts, authoritarian regimes are faced
with the task of preventing breakdown, deepening and organising the regime and generat-
ing legitimacy among elites and the population’. Erdoğan faced such a situation in his first
months as president, when the 2018 currency crisis quickly turned into a recession.
Alongside these intensifying conflicts within the power bloc, two other political devel-
opments shaped the AKP rule during the structural crisis period. First, in May 2013, the
Gezi Park protests unexpectedly completely shook the neoliberal conservative hegemony
of the ruling power bloc (Yörük, 2014). This was an eruption against both the neoliberal
urban restructuring of Istanbul and AKP’s increasingly repressive conservative policies.
The AKP’s ambiguous urban gentrification projects, which mostly aimed to generate
and redistribute the urban rent, to accelerate the construction sector, and thus, economic
growth, and to commodify urban spaces, culminated an enormous frustration among
urban population including but not limited to eco-activists, architect unions, artists and
local communities. In short, as Iğsız (2014) summarises, the Gezi Park protests developed
as a response to the institutionalisation of neoliberalism, centralisation of powers and an
increasing tendency of authoritarianism in Turkey. After initially vacillating, the state vio-
lently repressed the protests, making the Gezi Resistance a turning point in the AKP’s
strengthening of its coercive power over the opposition. The Gezi Park protests were sig-
nificant also because the liberals and left-liberals, who previously supported the AKP gov-
ernments against the authoritarian Kemalist state, withdrew their support to the AKP
upon the disproportionate state violence against the protestors (Benhabib, 2013).
Finally it was important with respect to the AKP government’s discourse because after
the Gezi Park protests the AKP began to employ Turkish right’s already existing ‘national
will’ concept extensively to attract nationalists as supporters (Bilgiç, 2018).
The second development, in 2015, was that, for the first time since 2002, the AKP failed
to secure an absolute majority in the general election. Five months of negotiations
between various political parties failed to produce a new government, which allowed Pre-
sident Erdoğan to call new parliamentary elections for 1 November 2015 (Kalaycioğlu,
2016). Thus, 2015 was another turning point in the formation of the new configuration
within the power bloc.
The AKP was thus forced to seek a more authoritarian regime to overcome the struc-
tural crisis, characterised by recurring economic bottlenecks. These reflected a crisis of the
capital accumulation regime that was eroding the party’s political support, increasing ten-
sions both within the power bloc and between the power bloc and subaltern social
groups. The AKP responded to these pressures in two ways. First, it formed a new alliance
with the MHP and modified its position on the Kurdish issue, both in Turkey and beyond,
in Syria, in line with this new nationalist configuration in the power bloc. It also increased
Turkey’s foreign policy activism with cross-border operations into Syria, the eastern Med-
iterranean, and Libya in 2019. Domestically, the new nationalist alliance sought the crim-
inalisation of the People’s Democratic Party (HDP). Second, the AKP has deliberately used
the political polarisation strategy to consolidate its electoral support since the onset of the
state crisis in 2007, and this strategy has become the primary political instrument of the
AKP to secure its power during the structural crisis period since 2013 (Somer, 2019).
94 Ü. AKÇAY

According to Göbel (2011, p. 182), authoritarian consolidation is ‘a deliberate state

project driven by political elites seeking to secure their ruling position’. He also argues
that the resilience of authoritarian regimes increases whenever a new regime shifts
from the dominance of despotic power to infrastructural and discursive power (Göbel,
2011, p. 177). Similarly, Ambrosio (2014, p. 473) also underlines that authoritarian conso-
lidation is a particular period in which ‘authoritarianism is solidified and entrenched
within a political system to the extent that expectations for democratic regime change
in the short-to-medium term are consistently pessimistic’. In brief, authoritarian consoli-
dation can be defined as a transition process in which the new regime is able to gain legit-
imation through increasing its problem solving capacity, and implementing populist
discursive strategies, along with the coercive measures. The concept therefore aims to
explain the main dynamics of the transition, rather than referring to a completed
process. I find this concept helpful to define the particular conjuncture in which the
Erdoğan administration established the new executive presidential system to overcome
the structural crisis. However, although the new regime’s discursive and despotic
powers are strong, its infrastructural power (i.e. for state restructuring and institution
building) is quite weak. In addition, the currency crisis hit Turkey’s economy in the first
few months of the new regime. Thus, it seemed very unlikely in 2018 that Erdoğan
would be able to consolidate the new authoritarian regime.
I argue that three main dynamics opened the door for authoritarian consolidation in
Turkey. First, the administration’s ability to cope with the economic crisis without imple-
menting a new IMF programme was a huge forward step. One particularly significant
change helped avoid implementing a severe IMF-controlled austerity programme: the
contraction phase of the GFC, from 2013 to 2018, ended and an expansion phase
began in 2019. Simultaneously, the Fed reduced interest rates for the first time since
the GFC and announced that its balance sheet would not be reduced soon (Federal
Reserve, 2020). These were critical changes for countries with dependent financialization
regimes, like Turkey. Had the global conjuncture in 2019 been similar to that in 2018,
there would have been a much more severe economic contraction in Turkey. Thus, the
global economic conjuncture rescued the AKP from implementing an IMF programme,
which could have reduced the AKP’s electoral support even more. These changed external
conditions not only enabled austerity measures to be postponed but also introduced a
huge cycle of credit expansion in the second half of 2019 (CBRT, 2020, p. 4). This factor
created a window of opportunity for the Erdoğan administration to increase its infrastruc-
tural power, in Göbel’s (2011) terminology, and to institutionalise its new regime.
The Erdoğan administration’s attempted authoritarian consolidation was coupled with
a new quest regarding the accumulation regime, which can be considered as one of
attempts towards increasing the regime’s infrastructural power. The 2018–2019 crisis
forced the AKP to strengthen its ad hoc8 and incoherent implementation of limited
import substitution measures to reduce Turkey’s external dependency, and the state’s
increasing involvement in the economy through stimulus-driven credit expansions led
by the public banks and the establishment of the Turkish Wealth Fund in 2016. After the
currency crisis in 2018, the government significantly restricted capital movements. The
aim of these ‘soft capital controls’ was to ensure the stability of national currency. Thus,
Turkey’s foreign-exchange regime was classified as a ‘managed float’ by the S&P Global
Ratings because the government blocked offshore swap markets to reduce the speculation
 CONTEMPORARY POLITICS 95

on TL (Courcoulas & Ozsoy, 2020). The public banks’ interventions in the foreign exchange
markets by selling their foreign exchange reserves were also as effective as the soft capital
controls in stabilising TL (Pitel, 2020). Public banks were not only used to stabilise TL but
also helped to revive credit expansion (Güngen, 2019). Finally, the government announced
a new incentive scheme, Advanced Productive National Industry Program, which is sup-
ported by three public banks with subsidised cheap loans to reduce the import depen-
dence of domestic production (Hazine ve Maliye Bakanlığı, 2019).
Second, securing harmony in the power bloc is an essential condition for authoritarian
consolidation. The support of large capital groups, such as Turkish Industry and Business
Association (TÜSİAD), and of the newly developing small or medium scaled capital groups
and business associations, which are considered as Islamic or AKP-related and located
mostly in Anatolia, for the political elite had helped the AKP won many previous
battles within the power bloc (Deniz, 2019). While the former remains the dominant
capital fraction, the latter has developed faster thanks to the lucrative public contracts
during the AKP rule (Gürakar, 2016). There has been evolving accounts regarding the
role that the so-called Islamic fraction of capital, also called as the ‘devout bourgeoisie’
or crony capitalists, have played regarding democratisation-authoritarianization axis in
different periods of the AKP power. Some pointed out the role of this capital fraction
as one of the key social forces behind the AKP and its ‘democratic’ agenda in the 2000s
(Gümüşcü & Sert, 2009).9 In contrast, ten years later, the same fraction was blamed for
being one of the key supporters of Turkey’s ‘democratic breakdown’, as it was encouraged
by the AKP via government contracts and tax incentives (Esen & Gumuscu, 2020).
While the former account fails to acknowledge TÜSİAD’s continues support for the
2001 IMF programme and the EU accession agenda, which were the two pillars of the
AKP’s authoritarian neoliberalism, the second ignores the role that the so-called non-
crony or secular capitalists, i.e. TÜSİAD members played in authoritarianization in the
recent years. I also argue that the culturalist divide among capital fractions, Islamic
versus secular, is not explanatory since all capital fractions supported the AKP govern-
ment to some degree during the last 18 years based on their material interests. For
instance, accessing cheap loans has been one of the key arenas of struggle among
different capital fractions. Large business groups, i.e. TÜSİAD members, not only have
better access to global financial channels but are also able to hedge their currency
risks against the fluctuations of TL. In contrast, the so-called Islamic capital groups
mostly depend on the government contracts and the national loan markets, which are
also dominated by the TÜSİAD members, and they are unable to hedge their currency
risks. Therefore, the interest rate policy and the degree of central bank independence
became the key policy areas over which different capital fractions struggle to dominate
(Akçay, 2009). Relatedly, TÜSİAD’s preference of the rule-based management vis-a-vis
other capital groups’ preference of discretion-based management is another disagree-
ment among the capital fractions (Buğra & Savaşkan, 2014).
Sustaining the balance of power among capital fractions and securing the dominant
capital fraction’s support were relatively easier tasks for the AKP during its first tenure
thanks to the strong economic growth rates (Bekmen, 2014). However, during the structural
crisis period, these tasks became increasingly challenging for the AKP because of slowing
down of the economic growth. Undoubtedly, the dominant capital fraction’s support for
the authoritarian consolidation remains one of the most significant determinants. That is,
96 Ü. AKÇAY

while the international financial cycle’s shift towards expansion in 2019 was an enabling
factor for consolidating the authoritarian regime, I would argue that the main driver was
the need to maintain a balance of power within the new power bloc. The necessity of sus-
taining harmony in the power bloc is also the main driver of the increasing despotic power.
The last dynamic of the regime consolidation was related to the regime’s capacity to
control the opposition. One the one hand, the absence of organised labour has been
one of the most important advantages of the new regime. Organised labour was primarily
eliminated through the authoritarian neoliberalism of early 2000s, which paved the way
for the authoritarian consolidation attempt in 2019. In this sense, despite the claims of
many scholars, the period between 2002 and 2007 cannot be assessed as one of demo-
cratisation; on the contrary, it actually enabled the formation of an ‘authoritarian labor
regime’ (Çelik, 2015). On the other hand, fragmented opposition bloc has been another
factor that facilitates the authoritarian consolidation. Keeping the opposition fragmented
is a deliberate objective of Erdoğan because the new election system requires obtaining
an absolute majority of the votes to be elected. In this new system, Erdoğan can still win
the next election even though he may not convince the opposition voters to for him, as
long as he successfully implements the divide and rule strategy against the opposition. To
this end, discursive power, which has been consolidated thorough elimination of free
media outlets (Yesil, 2016), has become one of the fundamental tools for the AKP,
since it has been functional in widening the already existing ideological (left wing vs.
right wing politics), cultural (secular vs. conservative lifestyles) and ethic (i.e. Turkish
nationalism vs. Kurdish Issue) cracks in the opposition bloc.

6. Conclusion
In this article, I provided an alternative explanation for the main dynamics underlying 18 years
of the AKP governments in Turkey, particularly to explain the Erdoğan administration’s recent
efforts at authoritarian consolidation from a critical political economy perspective. To do so, I
drew on the Regulation School’s framework and Poulantzas’s state theory. From this perspec-
tive, I first explained the main features of dependent financialization as a capital accumu-
lation regime and then the mode of regulations of money, labour, and macroeconomic
management as founding components of authoritarian neoliberalism in Turkey between
2002 and 2013. 2013 was a turning point for the Turkey’s political economy as a structural
crisis of Turkey’s capitalism has characterised the post-2013 period. The crisis of dependent
financialization, coupled with the crisis of the state, led the Erdoğan administration to change
the mode of regulation of macroeconomic management from depoliticisation to repoliticiza-
tion. It aimed to overcome both intensified struggles within the power bloc and eroding pol-
itical support through establishing a more authoritarian state structure, specifically a regime
change from a parliamentary to executive presidential system.
The latest episode of the structural crisis manifested itself in 2018 as the currency crisis.
I argued that the change in the global economic conjuncture in 2019 helped Erdoğan’s
administration avoid implementing an IMF programme because the US’s expansionary
monetary policy at that moment allowed a more rapid economic recovery in Turkey
while a state-led credit boom further supported the government’s authoritarian consoli-
dation efforts. However, while the structural crisis opened the door for authoritarian con-
solidation, the new regime is still fragile, both politically and economically. Finally, while
 CONTEMPORARY POLITICS 97

the main political challenge is to maintain the current balance of power within the power
bloc, the principal economic challenge for the Erdoğan administration is the possibility of
a persistently stagnant economy.

Notes
1. Akkoyunlu and Öktem (2016) may be an exception to this because they initiate to develop a
causal argument for Turkey’s ‘authoritarian turn’ by arguing that the AKP’s increasing fear of
losing its power via nondemocratic ways including ‘foreign invasion, violent overthrow by
coup or revolution’ generated an ‘existential insecurity’ for the party and its leader, and
they reason that this was one of the key reasons of the authoritarian turn.
2. For different variants of the continuity thesis see also Erensü and Alemdaroğlu (2018), Madra
(2018), and Tansel (2019).
3. Various concepts have been used to explain the main dynamics underlying financialization in
emerging capitalist countries, such as ‘subordinated financialization’ (Lapavitsas, 2013;
Powell, 2013; Bortz & Kaltenbrunner, 2018), or ‘peripheral financialization’ (Becker et al.,
2010; Rodrigues et al. 2016). For a detailed explanation on the dependent financialization,
see Becker et al. (2010), Becker and Weissenbacher (2015), Becker (2016), Gabor (2013),
and Akcay and Güngen (2019).
4. Although authoritarian neoliberalism has a close affinity with authoritarian statism, I prefer to
use the former concept to discuss the AKP rule although Turkey’s neoliberal transformation
started in 1980. For a detailed analysis that operationalizes the latter concept in the Turkish
case, see Oğuz (2008). For the application of these two concepts to different cases, see also
Chacko and Jayasuriya (2018), Chacko (2018), Jessop (2019), Bruff and Tansel (2019).
5. The Gezi Park protests, one of the largest anti-government protest movement in Turkey’s
history, aimed to protect a public park located next to the Taksim Square, Istanbul, against
construction of building a shopping mall. Yet, when security forces cracked down on peaceful
environmentalist activists, the protest movement rapidly expanded. The Taksim Square and
the Gezi Park were occupied by the protesters for more than 15 days, until the security forces
brutally crushed them.
6. The Gülenists are members of an Islamist organisation led by Fettullah Gülen, a Turkish cleric
who has lived in the US since 1999. The Gülenists played a significant role in the power
struggles between 2007 and 2016 because they were particularly well organised in the secur-
ity forces and state bureaucracy. They sided with the AKP until elimination of established
Kemalist forces from the state.
7. During this struggle, the Gülenists, which the AKP then viewed as a political Islamist commu-
nity who were also organised in the bureaucracy – particularly the police, judiciary, and mili-
tary – helped the AKP to purge the Republican part of the bureaucracy.
8. This aspect is not unique to the latest period of the AKP government as ad hoc policymaking has
a long history in Turkey. For the ad hoc nature of market reforms in Turkey, see Sönmez (2011).
9. For a comprehensive account of this argument, see Yalman (2016).

Disclosure statement
No potential conflict of interest was reported by the author(s).

Note on contributor
Ümit Akçay, Assoc. Prof. of Economics, has been a visiting scholar and lecturer at Berlin School of
Economics and Law since 2017. He previously held positions at Istanbul Bilgi University, Atılım Uni-
versity and METU in Turkey between 2016 and 2017, at the Department of Politics and at MEIS in
New York University in the US between 2011 and 2015, and at the Department of Economics of
98 Ü. AKÇAY

Ordu University in Turkey, between 2009 and 2011. He has a Ph.D. in development economics from
Marmara University, Turkey. His research interests are neoliberal populism, financialization in emer-
ging capitalist countries, critical international political economy and political economy of Turkey.

ORCID
Ümit Akçay http://orcid.org/0000-0003-0514-4831

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