• March 2024 (1)
  • December 2022 (1)
  • March 2022 (1)
  • January 2022 (1)
  • November 2021 (1)
  • October 2021 (1)
  • September 2021 (2)
  • August 2021 (4)
  • July 2021 (3)
  • June 2021 (4)
  • May 2021 (5)
  • April 2021 (2)

    Need for a nut-case team

    Fatih Özatay, PhD25 January 2009 - Okunma Sayısı: 1612


    Among the most unpleasant aspects of this crisis for Turkey is that it creates a great ambiguity that we cannot and will not be able to control. Measures are taken throughout the world, one after another. Nonetheless, the pessimistic climate is not disappearing. It seems like it is beginning to disappear, but the optimism lasts only for a couple of weeks. After that, new unfavorable developments appear, some people or countries are getting into trouble and the world is becoming covered by a new pessimistic climate. This implies a great ambiguity regarding what tomorrow will bring.

    This is one of the differences of this crisis from the 2001 crisis for Turkey. It is impossible for Turkey to eliminate the ambiguity by means of the economic policies to be implemented. Of course we can decrease the damage to be created by this ambiguity via correct policies; however, it seems that the ambiguity will remain right there. In opposition to this, eliminating the damage created by the 2001 crisis depended solely on the steps we could take.

    Furthermore, the global crisis can continuously change its shape making the policies suggested in an earlier phase of the crisis insufficient or completely dysfunctional. And this in turn requires flexibility in the design of economic policies.
    The global scale of the crisis and its ability to change shape implies that we are going through an extraordinary period. And extraordinary periods require extraordinary measures. This is another distinctive feature of the current crisis.

    We were able to and did get through the 2001 crisis with stability and restructuring policies. It is doubtless that there existed major challenges back then: There existed big discussions even about the necessity for stability and restructuring policies. Significant storms were weathered during both the designing and implementation of the economic program.

    However now, it is per se an issue even to "imagine" unusual measures. Besides, it requires significant effort to proceed from the imagining phase to the design of a workable policy. Explaining the design and making it accepted by the administration and then implementing it safe and sound can often become a nightmare.

    In this column, I commented on this issue sometimes with complaint. It will be familiar for those regularly reading my columns: In Turkey, it is per se an issue to design a conventional economic policy. Comprehensive economic policies are introduced in general when there is no other remedy, i.e. when it is impossible to preserve the status quo for instance, in periods of crisis. However, the duty to design of the critical parts of the programs is assigned to 'the others'. Unfortunately, we are giving the impression that "we are the citizens of a country that cannot design economic policies alone".

    However, we can design policies alone. We can unlike the fact that an extraordinary program is required. We can even the new shapes of the crisis impose different policies. It is crystal clear that we need a small group that focuses solely on the crisis without wasting time for the bureaucratic formalities and disputes. There are a number of qualified personnel in the Central Bank, Treasury, Banking Regulation and Supervision Agency, State Planning Organization and the Ministry of Finance trained specifically for such a work. Such a team can be formed of the qualified personnel that is to be 'stolen' temporarily from the aforesaid agencies and that will not hesitate stating 'nut-case' ideas.


    This commentary was published in Radikal daily on 25.01.2009l