How corruption destroys a democracy: The case of Turkey under Erdogan


Seven years ago, Time magazine heaped lavish praise on Turkish President Tayyip Erdogan, portraying his “secular, democratic, Western-friendly” form of governance in the Muslim world as “Erdogan’s Way.” It’s a cover Time would certainly like to take back.

Today, President Erdogan is showing the world another way. He has crafted a novel and potent ideology made up of elements of Islamism, nationalism, unswerving loyalty to a one-man cult and state-sanctioned corruption.

Erdogan has recently sought to rehabilitate his image by playing the good cop in the aftermath of the Saudi-sponsored killing of Jamal Khashoggi. The world would be wise to keep its focus on how Erdogan transformed Turkey in the span of just a few short years. People in Turkey and around the world are struggling to make sense of the authoritarian shift in Turkey’s political system, the seemingly riddling transformation from a model Muslim democracy into a repressive regime. They equally have difficulty coming up with a cogent explanation for Erdogan’s evolution from a promising Muslim democrat to an unruly, impulsive, transactional and autocratic political personality.

As a journalist closely following Erdogan’s political career since he was running for mayor of Istanbul in the early 1990s, I witnessed the key pillars of that transformation. I experienced Turkey’s novel, aspiring democratic openings under Erdogan’s watch in the 2000s and in the early 2010s but wound up as a victim of Erdogan’s late autocratic turn. This transformation began with the outbreak of the Gezi Park protests in May 2013 and a sprawling corruption investigation six months later in 2013. Both caught Erdogan and his family red-handed and unshackled his most authoritarian impulses to save his political skin. But the corruption scheme he cleverly built over time seemed to have played the main role in his increasing authoritarianism, and the outbreak of the 2013 probe only accelerated this.

Clever cronyism

Once seen as a beacon of pro-Western democracy, Erdogan’s new regime has been built on a loyal business class of crony capitalists, managed through an elaborate system of rewards and punishment. With the aim of consolidating its business constituency, his AKP party has politicized state institutions regulating debt collection, taxation, privatization of state-owned companies and public procurements. In doing so, his ruling party eroded the rule of law in order to redistribute resources to friendly parties and to transfer capital from opponents to supporters.

Erdogan has adroitly combined theft with reckless use of debt. Instead of extracting a slice from an already existing small cake, the traditional way of corruption in most developing countries, he has sought to enlarge the cake through public indebtedness and overseas loans to pliant businesses. The result made the business world, allies and the public happy, and assured a larger share for himself. So the public said, “Sure, he may be stealing, but look at the new airports, hospitals, roads and bridges!”

A leaked phone conversation between Erdogan and his son Bilal exposed the Ponzi system. In the alleged recording, Erdoğan and his son are discussing the amount of the bribe to be taken from a businessman named Sıtkı Ayan. Sıtkı Ayan is the owner of SOM Petrol, a London-based corporation that owns oil and gas wells in various countries and turns over billions of dollars every year.

Erdoğan finds Ayan’s offered $10 million insufficient, and instructs his son not to accept unless Ayan provides the amount he promised. Erdogan says to his son, “Others can bring it, so why can’t he, huh? What do they think is? But they are falling now, they’ll fall on our laps, don’t you worry.”

Turang Transit Transportation, also owned by Mr. Ayan, was awarded the government contract to build an $11.5 billion pipeline to transport natural gas from Iran and Turkmenistan to Europe. The investment was subsidized by the government, and the corporation was held exempt from VAT and various other taxes and duties.

In Erdogan’s Ponzi system, the government undertakes large infrastructure projects nonstop, irrespective of their economic rationality, mostly with much-inflated costs. Contracts go to loyal businessmen, while public tenders serve as a sham competition among bidders. The winner, in most cases, is determined in advance.

The lucky companies, having enjoyed government backing, found easy access to overseas lending and loans from strong European banks with the guarantee of Turkey’s Treasury. In return, the businessmen were expected to give Erdogan his share, in various forms and degrees, and to pledge to politically support him. This mutual cooperation took a number of forms. The loyal businessmen often repaid his favors by purchasing mainstream media outlets, turning them into pro-government mouthpieces, thus extending Erdogan’s reach and indirect control over Turkey’s ever-shrinking media landscape.

This trend only sealed Turkey’s steady drift into an autocratic regime where alternative media outlets are either shut down or purchased by pro-government businessmen. Showing no scruples, then-Prime Minister Erdogan put his son-in-law, current Finance Minister Berat Albayrak, in charge of a major business holding whose media arm was run by his brother, Serhat Albayrak. The Calik Group’s sole-bidder acquisition of Sabah and ATV group in 2008 – partly financed by Halkbank- became a matter of political controversy. Subsequently, pro-Erdogan Calik’s sale of the same media group to another group of Erdogan loyalists was no less controversial. The money used in changing ownership of this media group was collected from an associated businessman by one of Erdogan’s long time confidants, Binali Yıldırım, who served as prime minister.

Examples of this corporatist favoritism and the cost of opposing Erdogan’s way of doing business abound. The Koza conglomerate had businesses ranging from gold mining and construction to aviation and media. The company owned two large newspapers and two important TV stations. Akin Ipek, the head of the family that owned Koza, was on fine terms with Erdogan when Erdogan was walking on a democratic path.

Then the government swerved into increasingly corrupt and autocratic conduct starting with the Gezi protests in 2013. When the Koza media outlets covered the 2013 corruption scandal extensively, they incurred Erdogan’s ire. Consequently, it faced political pressure through a number of inspections, financial inquiries and investigations.

Perhaps more important, prosecutors aggressively went after Koza on trumped-up charges, including dubious accusations of financing terrorism, in what observers believed a politically-motivated trial. The result: all of Koza’s many subsidiaries are now in the hands of government-appointed trustees, and its media outlets, following government seizure, carried out Erdogan’s political agenda for nearly a year until they were fully shut down in the aftermath of the 2016 coup. Many members of the Ipek family went into exile in London in 2016 to avoid potential imprisonment. Akin Ipek’s brother, Tekin Ipek, received a 79-year prison sentence on charges including membership in a “terrorist group”.

In sharp contrast to Akin Ipek’s defiant stance in the face of government bullying and cajoling, there are examples of businessmen who preferred to co-opt and curry favor with the government, and have prospered as a result. Take the case of Ethem Sancak. He turned a small medicine business into a sprawling conglomerate during the Erdogan years, acquiring lucrative public contracts, including the production of tanks and water cannons for the Turkish army and police expected to gain around $4.4 billion for the company.

In return, Sancak bought a string of newspapers, radio stations and a TV network from semi-autonomous state agency the Savings Deposit Insurance Fund (TMSF). These were media outlets owned by private companies but seized because they had either fallen out of government favor or stumbled in their business operations. Sancak’s recently obtained media group owned three national newspapers, three television channels, two radio channels and two magazines, as well as several websites. Sancak famously said he was “in love” with Erdogan and would sacrifice his family for him.

Erdogan listed all mining companies and categorized them as green and red. Companies that have been in a relationship of clientelism with Erdogan’s political line were tagged as green and others that were seen as close to the opposition as red. While the application of Cengiz Construction -owned by pro-Erdogan businessman Mehmet Cengiz – finalized within 1-2 months, the decision process about similar applications of Koc Group (one of the biggest conglomerates in Turkey) and Koza Company took two years and they were rejected since their names were on the red list.

The Zarrab investigation leads to Erdogan’s moral collapse
Erdogan made this sharp U-turn from the democratic way when his cabinet members were implicated in a corruption scheme spearheaded by a Turkish-Iranian businessman Reza Zarrab to bust U.S.-led international sanctions against Iran. The second leg of graft investigation in December 2013 involved Erdogan’s family, with his son Bilal sought by prosecutors. This became the last straw for Erdogan who fought back tooth and claw to blight the investigation.

Unlike Turkey where authorities killed off the graft probe, in the U.S. prosecutors opened a new investigation, which sent chilling echoes across the political spectrum in Ankara. Taking his place in the witness stand in November 2017, Zarrab confessed his role in the sanctions-busting scheme, and mapped out, in a shockingly detailed fashion, how state-run Halkbank steered the entire process through forged and manipulated documents. The Erdogan government, Zarrab asserted in a Manhattan courtroom, was aware of the whole scheme and facilitated proceedings after Zarrab showered bribes and handsome amounts of money on officials.

Appalled by the conversion of Zarrab who, in a quest for a lenient sentence, chose to cooperate with F.B.I. and prosecutors, the government shifted its policy from defending him as a national hero and a victim of a U.S. plot to a concerted media campaign to discredit his claims by labeling him as spy and traitor. In a passing mention during his testimony at the courtroom, Zarrab implied that the scheme was known to Erdogan, a claim which prosecutors, for reasons still remain obscure, did not further push to illuminate during the rest of the trial.

The machinations of the Turkish strongman, however, were not limited to this case. Erdogan’s twists and murky dealings came to the fore once again, this time in Washington, D.C., just months before the 2016 U.S. presidential election. A businessman affiliated with the Turkish president, Ekim Alptekin, hired retired Gen. Michael Flynn, who later became Donald J. Trump’s first national security advisor, to lobby on behalf of the Erdogan government in its relentless quest to have U.S.-based cleric Fethullah Gulen extradited to Turkey. But Ankara’s longstanding push for the extradition of Erdogan’s arch-nemesis did not only involve formal requests and efforts through legal channels. It included an illegal scheme to kidnap Mr. Gulen from his residential compound in Pennsylvania to Turkey, discussed with Turkish officials in a now-famous September 2016 meeting. Flynn is awaiting sentencing on his conviction for lying to the FBI, while Alptekin – indicted in the US in December 2018 for lying to the FBI, including denying a Turkish government role in the scheme -is believed to have gone to ground in Turkey.

Faced with grave corruption allegations in total contradiction of his party’s promise for clean politics in line with Islamic values, Erdogan had two options: To allow due process and legal proceedings to take place or to destroy the independent judiciary and free media to prevent the graft probe from exposing his corruption.

Erdogan picked the second option and decided to undo the central pillars of democracy and rule of law for the sake of his political survival by creating a one-man rule. What he subsequently did was no different than what corrupt leaders across the globe have been doing for decades — removing checks and balances that safeguard the tenets of judicial independence. It is no surprise then that what Erdogan, like all other corrupt heads of state, hates most is a free media and an independent judiciary.

He was able to convince a lot of citizens — almost half of the country — by calling the corruption investigation a ”coup” against his government, a charge that he previously directed against protesters during the Gezi Park protests in the summer of 2013, six months before the outbreak of the corruption scandal. Prosecutors, judges, police officers and journalists who revealed his corruption either ended up in jail or were forced to go into exile. The 2013 probe sparked a purge in the judiciary and police, while spurring a new crackdown on critical media outlets.

Many critical and independent media institutions were silenced even before the infamous coup attempt in July 2016. The puzzlingly ineffectual coup, which many people suspected to be a staged one, led to the emergency rule that gave the president vast and sweeping powers to unrestrainedly clamp down on his political and social opponents, to squelch critical media and to reshape the country in his own image. The coup paved the way for his lifelong dream of an executive presidential system. In between, a two-year emergency rule enabled the government to undertake a sweeping purge across civil service and security bureaucracy, dismissing or suspending nearly 150,000 public workers and formalizing the path for Erdogan’s one-man rule. The entire drama and tragedy, when retrospectively examined, were the result of Erdogan’s efforts to cover up the 2013 corruption scandal.

Seen from this view, corruption has been woven into the ethos of Erdogan’s regime. While many scholarly attempts try to understand Turkey’s transformation from a reductionist perspective rooted in the political science literature of authoritarianism, the very corrupt nature of the regime and the centrality of the top-to-bottom corruption in all things associated with the political conduct of Erdogan’s government are mostly overlooked. The fusion of religion and nationalism in Erdogan’s latest political rhetoric, the over-emphasis on religious matters and the exposition of a renewed religious outlook are nothing but a facade to cover up the system of corruption and to perpetuate his power.

Ahmet Altan, who received a life sentence for telling the truth, summarized this Frankenstein-style metamorphosis of Erdogan in one sentence: “He preferred enrichment through dirty deals to being a respected and successful democratic Muslim leader worldwide.” (Altan was re-imprisoned after being briefly released following three and a half years in jail.)

Economic consequences
As a result of Erdogan’s choice, Turkish democracy, which Turks never obtained in a full-fledged form, suffered a dramatic breakdown. By all indication, Erdogan’s Ponzi system shows signs of collapse as well, together with the Turkish economy which Erdogan entrusted to his son-in-law Berat Albayrak.

In the past few months, over 3,000 companies applied for bankruptcy protection amid a slumping economy, soaring inflation and the surge in company debts in the private sector. This comes at a time when the Turkish lira struggles to keep its value against foreign currencies, mostly the U.S. dollar. In 2018 alone, the lira saw its value depreciate 80% against the U.S. dollar. To give perspective, one dollar was 1.7 Turkish lira in 2013; now it is 5.3. Inflation more than doubled in one year to around 24 percent. Inflation, when Turkey’s autocratic trends became clear and visible in 2013, was as low as 6 percent. According to Johns Hopkins Prof. Steve Hanke, who closely monitors Turkey’s tumbling economy, inflation, when measured with its real impact on consumer behavior and goods in the market, hit 49% in 2019.

To make matters worse, Turkey’s external debt is projected to hit $591 billion in 2020. Interest rates more than quadrupled in less than a year, from around 6% to nearly 25% According to the Turkish Statistical Institute, unemployment reached 14%. And youth unemployment hit 27% in late 2019. More than 20 percent of Turkey’s millionaires left the country (approximately 17,000 of them) and many talented people are leaving either due to economic failure or political climate. The mass exodus of human capital was not lost on authorities as Erdogan called on Turkish scientists living abroad to return home. Whether they will heed his call, under Turkey’s current bleak circumstances, remains to be seen.

It’s not just the economy. Turkey’s stature has taken a beating in all the standard international rankings. Turkey has fallen to 109th place out of 126 countries –down from 59th place five years ago — in the World Justice Project’s most recent Rule of Law Index, a comprehensive measure of the rule of law.

Similarly, the 2019 World Press Freedom Index put Turkey at 157 among 180 countries. Currently, Turkey had been the top jailer of journalists in the world from 2014 to 2018 and is one of the 25 most repressive countries.

Turkey’s rank in Transparency International Corruption’s Perception Index (CPI) has been decreasing rapidly since 2013. According to the 2019 CPI results, Turkey’s rank was 39th, having lost 10 ranks since 2012.

Transparency International further states that the executive branch of government has too much influence over other branches, particularly the judiciary, and the crackdown on the free press has made it harder for those in power to be held to account.

Erdogan transformed Turkey from a rare model of Muslim democracy into a corrupt autocracy. He is again on the covers of international media but this time as a dictator jailing journalists, women and even babies, torturing teachers.

The only way for Turkey to fix its deepening troubles in politics and economy is to return to the path of democracy and the rule of law. But this is the Achilles’ heel for all autocracies: Restoring normalcy would mean an end for the corrupt autocrats. And unfortunately, they do not go away easily. Meanwhile, the Turkish experience offers vital lessons for all democracies facing the same danger of corrupt populist leaders.

Abdülhamit Bilici

Abdülhamit Bilici is a leading Turkish journalist living in exile in the United States. He fled Turkey after the recent political turmoil and the government’s oppression of the media in Turkey. Before leaving the country, Bilici served as editor-in-chief of Zaman newspaper, the largest daily paper in Turkey. He was the Chief Executive Officer of Today’s Zaman, the English-language version of the newspaper. As a columnist at both papers, Bilici wrote mainly on foreign policy issues. He also served as general director of Cihan News Agency and editor of Aksiyon Weekly Magazine. Bilici is an expert on Turkish politics and is widely sought as a speaker on the ongoing political crisis. He is the editor of the book “Why Turkey?” which highlights different perspectives on Turkey and European Union relations.


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