Ayşe Yarar: Dr. Marois, thank you very much for accepting our interview proposal. Could you please give us some information about your academic life and studies, especially about your book titled States, Banks and Crisis: Emerging Finance Capitalism in Mexico and Turkey?
Thomas Marois: It is a great pleasure to be asked to share some of my thoughts on the topic of finance and politics in Turkey, one that I think is sorely under-studied.
As for myself, I have come to this line of research in a rather personal, and seemingly accidental, way at times. I come from a very working class background in Canada knowing little about Turkey (or Mexico for that matter). Not until I was 25 years old did I enter into the University of Alberta as an undergraduate. I was always curious about other societies, however, and so I signed up for an international exchange programme for my 3rd year of study. While I was initially given Taiwan as an option, in the end I was able to choose Turkey, specifically the Middle East Technical University (ODTÜ). I attended METU during the turbulent 1998-99 period in Turkey – a year that has proven undeniably formative in my life and academic career. I was later to do half my masters degree in Guadalajara, Mexico. The structural similarities, yet important specificities of each society’s political economies, led me to propose Mexico and Turkey as my comparative case studies for my PhD proposal, which I subsequently pursued at York University, Toronto, Canada. Under the guidance of Dr. Gregory Albo, Leo Panitch, and Susanne Soederberg, I developed my doctoral project into a study of comparative bank privatization, which I defended in the fall of 2008. During my subsequent postdoctoral fellowship at Queen’s University, Kingston, with Dr. Soederberg and then during the first year as a lecturer at SOAS, University of London, in Development Studies, I reframed my ideas and placed them on much broader finance and development groundings, which would eventually become my book published in 2012. The critical Marxian framework employed therein was shaped by my interactions with the Research on Money and Finance collective and associated debates on ‘financialization’ here at SOAS. In an attempt to raise similar questions of structural change, but more directly from the experiences of ‘developing’ countries, I reposed the issue as one of ‘emerging finance capitalism’ and placed both state transformation and the role of labour at the heart of my analysis of financial capitalism.
Ayşe Yarar: How would you broadly describe the finance in Turkey? If you compare Turkey with the EU countries in terms of their financial systems, what can you say us?
Thomas Marois: There is fairly general acceptance that once standard divisions between so-called bank-based and market-based financial systems are too rigid. Indeed, this is the case too in Turkey, which combines both elements. However, it is also very true that banks continue to dominate the financial sector comprising the vast bulk of assets. At the same time, the banks are intensely disciplined by market processes and neoliberal structures. So, I refer to Turkey as bank-based but market-oriented to capture Turkey’s historical specificity and its contemporary integration into the neo-liberalised world market.
Therein Turkey’s banks are relatively centralized and concentrated in terms of size, ownership, and control – and increasingly so over the last three to four decades. Clearly the 2001 crisis and Banking Sector Restructuring Program went a long way towards international (and EU) convergence, in many ways providing stricter regulations than their European counterparts. Significantly, however, there remains an important public banking sector, which controls about a third of all Turkey’s banking assets (Europe overall averages about 15 % public bank control). Ziraat, Halk, and Vakıf are long-held public institutions that have a rich pedigree of financing development in Turkey, despite the problems experienced in the mid-1990s when various coalition governments began hiding budget shortfalls in the public banks and other outright corrupt abuses.
Following my extensive research on the topic in early 2013, I believe there is an important and ongoing role for the state banks in Turkey. They are not perfect, and indeed suffer from institutional channels that can be abused by the government, as we have seen under the AKP with both Halk and Ziraat. But there is enormous creativity and energy among the public bank employees and a genuine concern for the public good in Turkey that cannot be had in the private banks. This ought to be protected, but the capacity for the public banks to serve the public good should also be enhanced. In this regards, there are some interesting models of cooperative and community banking in Europe that might be of interest to Turkey. Much more room could be made in Turkey for cooperative banking to work alongside the public banks and to serve identified needs, like SME, public sector, and agricultural funding, that have been underserved in Turkey or suffer from increasing problems (e.g., private banks’ growing repossessions of farms).
At the same time, there is certainly more freedom for bank workers to organize in Europe. While there are a range of bank worker unions in Turkey, changes to the labour code has made it increasingly difficult for unions to negotiate collective agreements. Moreover, the right to strike for bank workers needs to be granted in Turkey.
Ayşe Yarar: How do you evaluate the current economic situation in Turkey? Could you please give us your opinions about AKP government’s achievements and failures in Turkish economy?
Thomas Marois: Turkey, at a general level, has benefited from the global upturn after 2002 or so. This led to high rates of growth and, ‘development’, narrowly understood as GDP increases. This growth has also been unstable and highly variable. The 2008-2009 crisis dramatically hit Turkey, causing growth to plunge. Remarkably, the banks did not exacerbate the crisis for the first time. The public banks, moreover, greatly increased lending to counter the impacts of the initial downturn. Turkey subsequently benefited from quantitative easing in the US and UK, that is from cheap money and international investors’ search for higher returns. Growth rebounded but almost every class of worker was earning less than before the crisis and having to work more. It is well known that Turkey as a society has grown increasingly more unequal, albeit ‘wealthier’. According to the 2011 OECD Social Justice indicators, Turkey is among the most unequal of OECD countries, ranking consistently at the bottom of all indicators. Wages relative to inflation have been falling, and working conditions intensifying. There is no other way to describe Turkey’s developmental prosperity as anything but arriving on the backs of hard working Turks. This is the definition of neoliberal transformation.
To be sure, the AKP has made progress in some areas. There are notable improvements in public transport, health, and aspects of retirement schemes. Yet these are all subordinate to market-based and neoliberal imperatives, without genuine consultation or concern for broad-based social development. Equally important, the record of post-1980s governments in Turkey achieving much in the public sector is abysmal. So, against this low bar, it should be hard not for the AKP to have made progress, which they of course routinely exploit for continued electoral success. It is in this context that one must come to terms with the AKP electoral successes.
Ayşe Yarar: What would you say about the negotiations made with Turkey for the full membership to the EU. Do you think that Turkey is ready politically and economically to be a member of EU? If not, which requirements are there to fulfil and problems to overcome?
Thomas Marois: The EU accession process for Turkey is clearly at, or near, a dead-end and unlikely to proceed with its turn-of-the-millennium vigor anytime in the near future for a number of reasons. Most notably, Turks are fed up with the process and the unfulfilled promises of EU member nations. Many have just lost interest and don’t necessarily see any great benefit (aside from the Schengen visa). To be sure, accession should bring with it some deeper liberal democratic protections and labour rights, which are greatly needed in Turkey. But the EU project today is also a deeply neoliberal project – insofar as it is premised on the continued, substantive subordination of workers’ rights and wages to the needs of European capital and profit imperatives. Austerity rules as much in the EU as it does in the US, and EU accession also means the deeper internalization of such a market-oriented logic that, at the same time, displaces political authority and responsibility one step further away from effective democratic control and oversight. So, while people are frustrated with the slow process, they also have good economic reasons to be Euro-skeptics. On the European side, too, it is unlikely that there will be sufficient political will to push forward with meaningful progression, especially so long as economic recovery remains tenuous. Erdoğan is clearly aware of this and has been pursuing alternative trade strategies, notably in the wake of the 2008-2009 crisis, as a means to mitigate overdependence on European markets.
Ayşe Yarar: Could you please tell us your opinions about the latest status of press and social media freedom in Turkey?
Thomas Marois: The freedom of the press (and social media) is clearly in crisis, at least by any basic standard of democracy. Erdoğan has taken it upon the AKP and its corporate supporters to establish a formidable concentration of control over the sources of news most Turks receive. There are clear risks for those reporters (and average citizens) who seek to expose governance problems or even to openly debate the trajectory of Turkish society. The now infamous penguins image that arose out of the massive, spontaneous Gezi uprisings, adequately captures the tragedy of Turkish media – that a major broadcaster could be showing a documentary as police crack down on protesters in the capital city and Istanbul is extraordinary.
This is not at to diminish the very real and important alternative media sources in Turkey. There is truly a vibrant, critical, and often amazingly creative counter-media culture in Turkey that far surpasses much of the so-called democratic Western (but deeply corporate) media’s capacity to critic the establishment effectively.
Ayşe Yarar: What is your opinion about the concepts of moderate Islam and advanced democracy in Turkey? What do you think about the quality of Turkish democracy? Is it really advanced according to you?
Thomas Marois: I’ll limit my comments to the issue of quality of democracy because, aside from the important question of moderate Islam or not, the transition to neoliberalism in Turkey fundamentally means society is necessarily far from approaching ‘advanced’ democracy – if you take democracy to be more meaningful than bourgeois conceptions that limit it, fundamentally, to voting periodically on parties that rarely differ on economic policies. There has to be a serious debate on genuine and effective democratic control over economic processes. Central Bank independence is one such hot topic in Turkey right now. Global capital and neoliberal technocrats believe central banks everywhere, including in Turkey, must subordinate their decisions to price stability and inflation targeting. But this comes at the cost of relegating all other social and economic concerns to financial imperatives. Unfortunately in Turkey this issue has now come into the spotlight but in a way driven by the exaggerated discourse of Erdoğan’s framing of the ‘interest rate lobby’. This is unfortunate because real and important issues of employment, stability, equality, the political power of financial capital, and neoliberal development strategies are on the table, but being dismissed because no one can really take the issues seriously as posed. So, the demands of finance capitalism, more or less, prevail as jobs and workers continue to bear the brunt of neoliberal deepening. This is not a form of democracy that bears any relationship to social justice. Sadly, Turkish citizens are not alone in this democratic conundrum (and indeed EU accession will not resolve it).
Ayşe Yarar: As a last question Mr. Marois, could you give us the names of Turkish academics or writers that you follow closely and take their views into consideration?
Thomas Marois: I’m glad you asked this question, as a number of Turkish colleagues have been very important to my intellectual development and understanding of Turkey. By far the most important influence has been Dr. Galip Yalman at METU, under whom I first studied political economy during my undergraduate exchange in 1998-99. We have since stayed in contact and I regularly return to METU for talks and research projects (currently we are working on an EU Framework 7 Research Project on financialization in Europe and Turkey). Dr. Yalman is a constant source of inspiration and knowledge. I also draw on the work of Pınar Bedirhanoğlu and Aylin Topal from METU regularly. Dr. Ziya Öniş at Koç has been very supportive of my work, and his writings on Turkish political economy important to my understandings of change in Turkey. Drs. Fuat Ercan and Erinç Yeldan have likewise influenced my work, both theoretically and empirically. Finally, there are a couple young scholars with whom I have worked and whose research in the area of Turkish finance is exceptional; these are Drs. Elif Karaçimen and Ali Rıza Güngen.
Ayşe Yarar: Mr. Marois, thank you very much for sharing your opinions with UPA. Good luck in your studies.
Interview: Ayşe YARAR