Can the opposition win?

Yes it can. This doesn’t mean it will.

Before 2019, the consensus view was that the incumbent party and Erdoğan would, somehow, almost always win. After the 2019 local elections the opposition saw an opportunity. Should the broad alliance that proved successful in so many municipalities be repeated on a large scale, the opposition could win both the parliamentary and the presidential elections. The economic crisis runs so deep that everybody is expecting an opposition victory. However, it isn’t that simple for a number of reasons. Yes, politics conveys so much noise from time to time that calculating political uncertainties becomes very difficult. The political process seems to be erratic, perhaps almost random. This isn’t the main reason why predicting the outcome is difficult in spite of so many economic problems.


The incumbent party has been in power since late 2002, almost 20 years. This may have an effect because people get bored, especially if millions live under economic duress. Indeed, if voters were fully rational in the sense that they only look at the economic conditions and their personal finances, the political agenda would be one-dimensional. However, there is also the ideological-cum-cultural dimension, a dimension that encompasses religious beliefs and nationalism. The second dimension is what renders the political process quite complicated, and sometimes makes all the difference. We should note that the AKP has 11 million members. This is an incredibly high number, and in terms of its party member/voter ratio it is probably the highest in the world. If 40-45% of AKP voters are also party members, it is easy to understand why there is an irreducible core constituency that never drops below 25-28%. Even today, amidst rumours, anecdotal evidence, and opinion poll results that suggest the opposition has the upper hand, the AKP-MHP alliance can secure 40+% of total votes.

Students of American politics could look at 40+% and say “well, the opposition must surely win”. This isn’t so because Turkey has a multi-party system. In order to win, almost all of the rest of the votes should support the same candidate. Now that the mostly Kurdish HDP is trying to form a third bloc with small left-wing parties, and that this party can be banned from running because there is a pending law suit that says it should be closed down, there are at least three vectors that span the electoral space.


The ideological-cum-cultural support of the ruling alliance is quite compact. It appeals to religion and nationalism, two pillars that are important in any society. There is also the advantage of being in power; the incumbent bloc can choose the timing of the elections if they are to be held early, they can change the electoral system (the threshold, the single-member district, whether the threshold also applies to parties that are part of the alliances etc.), and they can distribute pecuniary benefits to the electorate. They can spend a lot from the central budget ahead of elections – a classic in Turkish politics. The opposition is different. There are currently six parties in the main opposition bloc, and there may be even more in the third alliance gathering around the HDP. There is no way the HDP can be in Millet İttifakı, the main opposition bloc, because HDP is a thing in itself in Turkish politics. It is treated as if it were a thing apart. It has to stand alone or perhaps co-operate with small leftwing parties only. If it approaches Millet İttifakı too closely, then Millet İttifakı would probably split apart. The second largest party in this bloc, İYİP, embodies many farright nationalist politicians and somehow represents both the centre-right and the farright. It is itself an intriguing phenomenon. The other parties forming Millet İttifakı are also miles away from each other and notably from the CHP, the opposition leader. There is no ideological congruence therein. It can only be a temporary alliance that rests on a set of common beliefs that form a minimalistic programme: democracy, good governance, and accountability.


Yes, İYİP is an interesting phenomenon in more than one sense. It is the new kid in town although there is nothing new about it. However, this is the first time in a decade a nationalist-cum-centre right politician (Akşener) challenged the status quo of the conservative right. There was high hope that İYİP could manage to attract not only voters from the costal and urban areas but also from the strongholds of MHP in central Anatolia. I don’t have the full data yet but it looks like İYİP succeeded in the first task but much less so in the second. Yet, it is firmly entrenched to the political soil, and carved for itself a solid place in the electoral space. Second, both İmamoğlu (Istanbul) and Yavaş (Ankara) mayors managed to run an influential campaign in 2019 based on a ‘winner’s claim’ – an “I will be the next president” type of self-confident standing shored up by neo-populist promises. They both are perceived as successful mayors after two and a half year in office. They managed to gain support from the ranks of traditionalists, former voters for the AKP and MHP. Naturally, there can be an upper limit to what they can achieve if they run for presidency. Related to the İYİP phenomenon, Yavaş seems to have a better chance than İmamoğlu because Yavaş can appeal to some MHP voters in addition to CHP and İYİP voters.


All too often, governments overspend and over-borrow. Is the ability of the government to borrow limited by its capacity to tax? Is Ponzi finance feasible for an infinitely lived government? The standard answer to the first question is based on the government solvency constraint. The argument states that taxes constrain borrowing whenever the long-run after-tax rate of interest exceeds the long-run real rate of growth. Otherwise, bond financing would lead to instability in the sense that the asymptotic variances of the price level, the real stock of money, real wealth, the nominal interest rate, the real rate of interest and the inflation rate would all be infinite. Only current output would have a finite asymptotic variance.

What this says is that the present discounted value of the terminal government debt should be non-positive in the limit if the system has an infinite life. This implies, in turn, that the sum of the present discounted values of all future primary surpluses (i.e. surpluses excluding interest payments) needs to be as large as the outstanding stock of public debt, foreign and domestic. In the end, government spending can’t be negative, it can only be equal to zero: zero is the absolute lower bound. Hence, the maximal amount a solvent government can borrow is a fortiori constrained by the present discounted value of future taxes the net of transfers.

The answer to the second question is also a classic. Ponzi finance is feasible only if the long-run after tax rate of interest on government debt is smaller than the long-run real rate of growth. Interest income may or may not be taxed. If interest income is untaxed, Ponzi finance can only be possible if the economy is dynamically inefficient, provided that the economy is deterministic and admits perfect foresight equilibrium. If the economy is stochastic, i.e. if uncertainty prevails, then Ponzi borrowing becomes doable only if the equilibrium is Pareto suboptimal, even if dynamic efficiency obtains. Unless full intergenerational insurance can be safely assumed to exist, such an economy will be Pareto-suboptimal in a natural way.

We have passed that stage though. Political Ponzi games can be implemented with the hope that elections will take place before the bubble bursts.


Politics is about income and wealth distribution, taxation, and public spending. It is almost never about virtue or civic liberties or about all-encompassing visions of just society. In practice, such visions are at best indirectly represented. However, there are societies in which traditional values and ideologies weigh more heavily. It isn’t just a matter of prosperity or societal development: in France, religion plays no role but in the U.S. it does. Where political patronage and favouritism are mixed up with strong ideological beliefs, the situation gets complicated.

Leave a Reply

Your email address will not be published.