Search Results

Introduction From the horrendous wildfires along the Aegean Coasts to water shortages in Central Anatolia, the fingerprints of climate change are already visible all across Türkiye, including its economy and daily life. Such mounting pressure makes the climate issue a more pivotal concept for Türkiye. Türkiye has set an ambitious target to hit net-zero emissions by 2053, keeping in step with climate efforts at an international level. Introduced in 2021 in conjunction with ratification of the Paris Agreement, the 2053 target will necessitate wide-ranging alterations in the economy. Reaching "net zero" involves offsetting any residual emissions with removals (such as forests or technology) to such an extent that net emissions fall to zero. This mid-century deadline is aligned with scientific consensus that preventing more than 1.5 °C warming requires carbon neutrality by mid-century. As an emerging country and G20 nation, Türkiye's transition will bring challenges: such as reusing old energy systems and sectors, as well as opportunities, such as less dependence on imported fossil fuels, and green economic development. Aligning with its global aspirations, Türkiye's 2053 net-zero commitment puts it in the ranks of numerous other countries that have adopted mid-century targets for carbon neutrality. The majority of European Union nations, for instance, adopt 2050, followed by 2060 for China and 2070 for India. Türkiye's target date "2053" is emphatically related to domestic achievements, but in fact, represents adherence to the global timescale in the Paris Agreement to contain climate change. After years of reluctance, Türkiye became a party to the Paris Agreement in October 2021 and presented its updated First Nationally Determined Contribution in 2023. Under the revised NDC (Nationally Determined Contributions), the nation pledged to decrease emissions 41% below normal by 2030 (approximately 695 MtCO₂e in 2030) and peak emissions by 2038. This implies that emissions could keep on rising until 2038, then decline dramatically to reach net-zero in 2053, an extremely tight timeline. Upon a comparative perspective, as a mid-level emitter with about 1% of world emissions, but with per-capita emissions on an upward trend as it grows economically, achieving net-zero in 2053 would support world targets and is particularly important in being part of continued efforts to limit warming to well below 2 °C. This is also aligned with Türkiye's main trade partners' climate ambitions (particularly the EU) to avoid trade losses. The net-zero target in Türkiye is, however, noted by international analysts as not having solid near-term action outlined in it at present and being rated "poor" in terms of strength in the absence of stronger mid-term targets. Policy Developments and International Context Early Policy Milestones (2021 – 2023) Türkiye has taken concrete steps in climate policy since 2021, such as ratifying the Paris Agreement, committing to the 2053 target, issuing the 2010 – 2023 National Strategy on Climate Change, the 2011 – 2023 National Climate Change Action Plan, and the Green Deal Action Plan. However, all of these efforts are not legally binding due to the absence of an enforcement mechanism. “2053” Strategy Announcement (COP29, 2024) In 2024, Türkiye announced its “2053 Long-Term Climate Change Strategy” at COP29, which was held in Baku on 11 – 22 November¹ and later published by UNFCCC. The strategy² includes a section on “Preparation Process of the Long-Term Climate Strategy” that underlines efforts and measures. Among these, the ‘Climate Law’ stands out in particular, as it was being drafted when the strategy was announced to incorporate international agreements ratified by Türkiye into domestic legislation and to pave the way for the establishment of a legal framework for climate-change action³. The law aims to support Türkiye’s green growth, establish a legal framework for combating climate change, and achieve its 2053 net-zero emission target. The law is crucial for providing a legal ground for the reduction of greenhouse-gas emissions, planning and implementation tools, and an institutional framework⁴. The 2053 Long-Term Climate Change Strategy is crucial as a strategic roadmap with the potential to strengthen Türkiye’s 2053 net-zero emissions target. Draft Climate Law and Legislative Journey However, after the draft law was approved by the Environment Committee and presented to the Presidency of the Grand National Assembly of Türkiye—where it was expected to become law in the General Assembly—Türkiye’s first “Climate Law Proposal” was withdrawn after strong criticism from opposition parties and environmental groups. The draft law is an important step in Türkiye’s fight against climate change as it includes various planning and implementation tools to concretize the 2053 Net-Zero Emissions Target and the goals outlined in Türkiye’s Nationally Determined Contribution (NDC) within the framework of international agreements to which Türkiye is a party. If enacted, the law would have established the Carbon Border Adjustment Mechanism (CBAM), an Emissions Trading System (ETS), introduced carbon pricing, and imposed new obligations on businesses. However, the draft law also contains several shortcomings that reveal a lack of inclusiveness, commitment, and clarity in drafting and implementing carbon-reduction policies. Key Shortcomings Highlighted by Stakeholders First, the draft law does not include a policy or an absolute emissions-reduction target regarding when and how Türkiye will reduce its carbon emissions. Instead, it envisions that Türkiye’s NDC will be updated at specific intervals and submitted to the UNFCCC Secretariat⁵. While Türkiye has set an ambitious target to hit net-zero emissions by 2053, the proposed law lacks well-defined targets to achieve carbon neutrality by that year⁶. In this context, the fact that the 2053 net-zero target is mentioned only in the rationale and that there is no provision for it in the actual text of the law raises concerns about its enforceability. Second, despite emphasizing the role of public institutions in incorporating climate targets into their decision-making processes, a concrete mechanism for its application is missing⁷. The lack of an enforcement mechanism for responsibilities among relevant public institutions and authorities raises doubts about policy implementation toward reaching net-zero emissions by 2053. Public Engagement and Just-Transition Concerns More importantly, during the preparation of the draft law, there was insufficient communication with environmental and ecological associations, civil-society organizations, and experts whose input was overlooked. For a transparent, inclusive, and accountable implementation process, it is crucial to engage NGOs, professionals, and the scientific community. Finally, other criticisms of the proposal included concerns that concepts such as climate justice were being diluted. In other words, the just-transition concept remained merely at the level of discourse, with no concrete implementation mechanisms specified. This is crucial because a just transition is an important enabler for implementing the net-zero transition: including all affected parties and addressing injustices helps ensure political acceptability for climate action, ease the risk of just-transition litigation, and avoid delays in reaching the net-zero target⁸. Paris Agreement Summit Broader Geopolitical Headwinds Another factor to consider for Türkiye’s 2053 Net-Zero Commitment is the range of geopolitical risks. In his second presidency, Donald Trump’s executive actions on climate and environment included withdrawing the U.S. from the Paris Agreement, declaring a “national energy emergency” to double down on oil and gas, and eliminating a push for environmental justice—actions that will have severe implications for global climate action⁹. As a major geopolitical player and top emitter, the U.S. significantly influences global climate dynamics¹⁰. Trump’s anti-climate policies are also wearing down fragile support for net-zero targets and enhancing the opportunism of policy-makers sceptical of climate-change mitigation efforts¹¹. Furthermore, as the EU faces backlash over climate regulations and deals with the war in Ukraine, the bloc is shifting its spending priorities from greening the economy to investing in defence¹². Türkiye, already navigating a complex balancing act between domestic energy needs and climate ambitions, may face reduced international pressure or incentive to accelerate its transition. Barriers, Risks, and Opportunities In addition to international scepticism surrounding the project's feasibility within the proposed timeframe, conflicting policy objectives may hinder the Turkish administration’s willingness to accelerate its efforts on renewable development. A key obstacle to full commitment towards net zero is the trade-off between economic growth and emissions reduction. Economic growth remains a top priority in Türkiye, as reflected in President Erdoğan’s ambition to transform the country from a “regional economic centre” into a “global economic powerhouse.” Historically, there has been a strong positive correlation between economic growth and energy consumption. Fundamentally, energy facilitates economic development and the production process by complementing capital and labour inputs. Therefore, if growth is to be pursued, energy demand will likely continue to rise steadily in the foreseeable future. The implications for emissions are largely reflected in the outlook for domestic energy production. Türkiye’s ongoing reliance on coal has previously raised concerns, especially after it overtook Germany in 2024 as the largest producer of coal-fired electricity in Europe. However, significant coal projects have recently been cancelled as the state shows increasing support for renewable alternatives—an encouraging signal of a potential decline in coal dependence. A continued coal phase-out would be a major milestone in decarbonisation, given coal's severe health and environmental impacts. However, this must not come at the expense of economic growth, energy affordability, or energy independence. As a short-term measure, the Turkish government may promote less polluting fossil fuels, such as oil and natural gas, while building a broader transition to renewable sources. In line with this strategy, Türkiye has invested heavily in oil and gas exploration, with 270 drilling operations planned for 2025. While this approach does risk entrenching a more carbon-intensive energy future, it would nonetheless mark a notable improvement over the current status quo. Through this strategy, Türkiye aims to strike a balance between economic growth and emissions reduction. There is further cause for optimism as renewable energy costs continue to fall a trend expected to persist. Türkiye’s geography and climate are well-suited for solar and wind energy, offering a promising path to cost-effective and sustainable energy independence. Large-scale implementation is expected once the cost structures and reliability of renewables justify mass adoption. Continued investment in energy efficiency is also anticipated, as it serves the interests of both the public and private sectors. Thus, a future in which growth and emissions are no longer mutually exclusive but instead become complementary, with numerous positive spillover effects, appears increasingly achievable. Another crucial factor in renewable energy development is investment and capital, which are essential for building the necessary infrastructure. As a developing economy, Türkiye relies on a mix of domestic investment and foreign direct investment (FDI) to finance large-scale renewable energy projects, such as offshore wind farms. The Twelfth Development Plan (2024–2028) outlined a strategy to increase Türkiye’s share of global FDI to 1.5% and regional FDI to 12% by 2028. However, actual figures have fallen short of potential: FDI was estimated at $10.6 billion in 2024, missing the earlier projection of $14 billion. Nevertheless, a positive trend is emerging. Policymakers have implemented disciplined monetary and fiscal measures in a successful effort to tame persistent inflation. Year-on-year inflation fell to 44% by the end of 2024 and is expected to decline below 30% in 2025. Capital inflows have also recovered, with strong demand for recent bond issues and subsequent declines in yields. All three major credit rating agencies have acknowledged these improvements, upgrading Türkiye’s sovereign credit rating twice in 2024. These upgrades signal a reduced perception of risk and instability, increasing confidence among foreign lenders and investors. Although this remains a multi-year effort, Türkiye is on track to realise its FDI potential—provided it continues to restore trust and credibility in its economy. A new strategy proposed by the Republic Investment Office of Türkiye prioritises experimentation with renewable infrastructure and technological initiatives in underdeveloped regions. This aims to attract meaningful contributions toward Türkiye’s sustainable development goals. The country also hopes to deepen its integration into global supply chains through continued green transformation, digitisation, and the growth of high-value services. This will not only enhance Türkiye’s global competitiveness but also strengthen its commitment to renewable innovation, improving the plausibility of achieving net zero by 2053. Türkiye has notably kept pace with the global electric vehicle (EV) trend—one of the fastest-growing sectors of its economy. EV sales are projected to account for 30% of all automobile sales by the end of the year, driven in part by domestic automaker TOGG, which has sold over 50,000 vehicles. Additionally, Chinese EV manufacturer BYD has pledged to build a $1 billion plant in Türkiye, demonstrating international recognition of Türkiye’s renewable growth strategy. The Turkish government has matched this momentum, planning to invest over $100 billion by 2035 to expand renewable capacity and modernise energy infrastructure. This serves as further testimony to Türkiye’s dedication to achieving its net-zero target while ensuring energy security and economic growth. Transforming Key Sectors for Net‑Zero 1. Energy Current status. The energy sector is Türkiye’s single largest greenhouse‑gas source, generating 73.8 % of national emissions in 2023 (≈ 442 Mt CO₂‑eq). Electricity production is still dominated by fossil fuels, so—even with steady growth in renewables—carbon intensity remains high. Transition levers: Rapidly scale solar and on‑shore/off‑shore wind capacity. Boost system‑wide energy‑efficiency investments. Cut technical and commercial grid losses. Deploy carbon‑capture and storage (CCS) where renewables cannot yet displace fossil assets Opportunities: Local clean power reduces import dependence, lowers foreign‑exchange outflows, stimulates green‑tech jobs, and improves long‑term energy security. 2. Transportation Current status. Transport‑related CO₂ sits within the energy inventory; road vehicles are the principal source. Transition levers: Accelerate electric‑vehicle (EV) rollout with charging‑network expansion. Shift freight from road to rail and coastal shipping. Tighten efficiency standards for conventional vehicles and promote biofuels / e‑fuels where electrification is difficult. Opportunities: Cleaner mobility cuts urban air pollution, opens manufacturing niches for domestic EV producers, and slashes oil‑import bills. 3. Industry Current status. Heavy industry emitted ≈ 70.7 Mt CO₂ in 2023 (11.8 % of total). Steel, cement, and other energy‑intensive subsectors dominate that footprint. Transition levers: Upgrade to best‑available, low‑carbon process technologies. Electrify heat wherever feasible and integrate green hydrogen for high‑temperature processes. Expand circular‑economy measures—higher recycling rates and industrial‑symbiosis clusters. Require firm‑level carbon‑footprint disclosure and tie finance to decarbonisation plans. Opportunities: Efficiency gains cut operating costs, green products gain export‑market access, and new investment flows toward low‑carbon manufacturing. 4. Buildings Current status. Buildings consume roughly 30 % of Türkiye’s energy; much of the existing stock has poor insulation and outdated systems. Transition levers: Mandate high‑performance envelopes and heat‑pump/HVAC standards for all new construction. Launch nationwide retrofit programmes for older housing, with fiscal incentives. Roll out smart‑metering and building‑management systems. Promote green‑building certification (e.g., YeS‑TR) and district heating/cooling where density allows. Opportunities: Deep efficiency retrofits lower household energy bills, create skilled construction jobs, and make cities more resilient to climate extremes. 5. Agriculture Current status. Agriculture accounted for 12 % of 2023 emissions (≈ 71.9 Mt CO₂‑eq), driven mainly by livestock methane, synthetic‑fertiliser N₂O, and land‑use practices. Transition levers: Deploy anaerobic digesters and improved feed additives to cut enteric methane. Raise fertiliser‑use efficiency; adopt precision‑ag and organic alternatives. Convert agricultural residues to biogas/biomass energy. Provide farmer training and carbon‑smart extension services. Opportunities: Lower input costs, new revenue from bioenergy, healthier soils, and alignment with emerging low‑carbon food‑export standards. Türkiye’s Green Economy and Green Technology Transformation In the contemporary world, the net-zero carbon ambitions of countries in the global fight against the climate crisis call for a shift in green technology and innovation. The Republic of Türkiye's 2053 net-zero carbon ambition is not only an environmental commitment, but a comprehensive overhaul of technological infrastructure and industrial ecosystem. Here, it is pertinent to discuss the role of paradigmatic changes in green technology and innovation in the shift of our country towards a carbon-neutral economy. Renewable Energy: Solar and Wind Power Dominance On the path to Türkiye's 2053 net-zero target, solar and wind energy are projected to reach a dominant position among renewable energy sources. According to data from the Ministry of Energy and Natural Resources, as of 2023, 19.2% of Türkiye's total electricity production is supplied by wind and solar energy, with this ratio targeted to exceed 65% by 2053. Compared to traditional energy production methods, the cost-effectiveness of solar and wind energy and their radical reduction in carbon emissions highlight these two resources. Large-scale solar power plants established in regions with high solar radiation such as Konya, Karaman, and Karapınar, and wind turbines along the Aegean and Marmara coasts hold strategic importance for Türkiye's energy independence. However, it should be emphasized that the increase in production capacity of solar and wind energy necessitates the modernization of the interconnected grid. According to projections by TEİAŞ (Turkish Electricity Transmission Corporation), the required investment in grid infrastructure until 2053 exceeds $50 billion. The intermittent production characteristic inherent to renewable energy sources brings complex problems in grid management. Therefore, the integration of smart grid systems and storage technologies will play a critical role in achieving the 2053 target. Hydropower and Geothermal Integration: Modernization Opportunities Hydropower and geothermal resources have historically dominated Türkiye's energy mix. As per TÜBİTAK MAM's "Turkey Renewable Energy Potential Report" released in 2023, Türkiye's technically feasible hydroelectric potential is around 160 TWh/year, out of which approximately 70% is today utilized. However, as part of efforts to achieve the 2053 net-zero, modernization of these two sources of energy is inevitable. The use of digital twin technologies for hydroelectric power plant efficiency optimization and turbine optimizations, novel drilling technology and general acceptance of binary cycle systems for geothermal power, will have basic roles in optimizing the utilization of these resources. In this connection, as per the 2022 "Turkey Geothermal Potential and Future" report issued by JESDER (Geothermal Power Plant Investors Association), at present, only 1.7 GW of Türkiye's 4.5 GW geothermal potential has been utilized. Usage of geothermal resources of Western Anatolia even for electricity generation and district heating and cooling options by means of integrated systems holds serious implications for enhancing energy efficiency. Energy Storage and Battery Technologies Energy storage systems are one of the most critical technologies in achieving the 2053 net-zero vision. Specifically lithium-ion battery production and increasing the storage capacity are key to the feasibility of renewable energy. Through the application of TÜBİTAK Marmara Research Center-coordinated BATARYATÜRK project, Turkish domestic battery manufacturing capacity should be 60 GWh by 2030. By doing so, Türkiye will achieve a crucial infrastructural requirement, not just in the energy sector, but also in developing an electric vehicle value chain. The second-life battery concept pertains to the recycling of batteries that have expired their life of operation in electric vehicles for the use in stationary energy storage systems. According to the "Energy Storage Systems Roadmap" report published by EPDK (Energy Market Regulatory Authority) in 2024, it is feasible for 20 GWh of second-life batteries through 2040. Utilizing this opportunity in accordance with the ideas of circular economy will contribute towards decreasing the carbon footprint. Hydrogen and Power-to-X Technologies Green hydrogen will be a strategic element for Türkiye to achieve its net-zero target. The total hydrogen production capacity is set to be increased to 8 million tons by 2053, with at least 80% of it being green hydrogen, as stated in the "Turkey National Hydrogen Strategy" published by the Ministry of Energy and Natural Resources in 2022. Technological advances in electrolyzers to decrease the cost of green hydrogen and the benefits resulting from economies of scale will be critical factors in reaching this objective. Industrial decarbonization based on hydrogen is very promising, especially in the steel, cement, and chemical industries. According to TÜSİAD's (Turkish Industry and Business Association) "Decarbonization Roadmap in Turkish Industry" report dated 2023, the use of hydrogen technologies has to be brought into practice in order to reduce the total emissions of these three sectors by up to 60%. Green hydrogen as a fuel source replacement for fossil fuels will have a revolutionary effect in industrial process decarbonization. Electric Vehicles and Battery Ecosystem The utilization of electric vehicles in mass numbers is unavoidable for reducing carbon in transportation. Following the launch of Türkiye's domestic-made automobile brand TOGG, concerns regarding domestic manufacture of batteries and charging stations became even more necessary. Türkiye has 8,500 charging points as of 2024, and this is expected to increase to 100,000 by 2030 and to 500,000 by 2053, based on Ministry of Industry and Technology figures. Foreign electric vehicle manufacturers like BYD's intentions to establish production facilities in Türkiye and the electric vehicle transformation of the domestic motor industry make localization more important in battery technologies. In line with the "Automotive Supply Industry Electrification Roadmap" given by TAYSAD (Automotive Suppliers Association of Turkey), 60% of automotive supply companies will be required to transform their activities to producing electric vehicle components by 2030. It will bring great opportunities in terms of employment and technology transfer. Carbon Capture and Utilization (CCU) Technologies Carbon capture and utilization technologies are quite important for emission reduction, especially in the short and medium term. According to TÜBİTAK MAM Energy Institute research, the carbon capture potential of Türkiye is 120 million tons of CO2 equivalent annually. To take advantage of this potential, artificial photosynthesis, carbonation, and synthetic fuel production technologies need to be developed. Decreasing the cost of carbon capture technologies and making them more scalable are the greatest challenges in this area. It is targeted in TÜBİTAK's 2024-2030 R&D Roadmap to decrease the cost of carbon capture technologies per ton by 50% by 2030. Reaching this goal will be a significant step in achieving the net-zero carbon goal. R&D Ecosystem and Institutional Transformation Türkiye needs a strong R&D environment to fulfill its 2053 net-zero ambition. TÜBİTAK established in 2022 the "Net Zero Research Institute," a flagship institution that performs coordinated research on green technologies. Energy storage, hydrogen production, and carbon capture technologies are some of the research topics identified by the institute for the years 2023-2028. Raising the R&D spending of the private sector is also required at this stage. The ratio of Turkish companies' green technology R&D spendings to GDP is 0.25%, and it is targeted to increase this ratio to 1% by the year 2030, according to TÜSİAD's "Green Transformation and Business World" report published in 2024. Both for the promotion of technological innovation and for the increase in the amount of green jobs, this increase is vitally significant. Conclusion Green technology and innovations will play the central role in Türkiye's pathway to achieving its 2053 net-zero ambition. Renewable resources optimization, an increase in the capacity of energy storage, the production of green hydrogen, electric vehicle ecosystem building, and en masse use of carbon capture solutions are the key areas of interest in the success of this process. For the sake of ensuring this technology revolution, institutional framework and policy programs should also be reshaped. R&D activities to be carried out under TÜBİTAK coordination and enhancing the capacity of the private sector for innovation will lead Türkiye to the forefront of global power in green technology. The realization of the net-zero goal requires a technological transformation, and a social and economic transformation. For this purpose, policymakers, academics, entrepreneurs, and civil society actors should collaborate under a common vision towards the building of a sustainable world. References 1. Ministry of Energy and Natural Resources. (2023). Turkey Energy Outlook 2023. (https://enerji.gov.tr/bilgi-merkezi-enerji-istatistik-rapor-gosterge) 2. TEİAŞ. (2023). Turkey Electricity System 2053 Projection Report. (https://www.teias.gov.tr/tr-TR/yayinlar-raporlar) 3. TÜBİTAK MAM. (2023). Turkey Renewable Energy Potential Report. (https://mam.tubitak.gov.tr/tr/yayinlar) 4. JESDER. (2022). Turkey Geothermal Potential and Future. (https://www.jesder.org/raporlar) 5. EPDK. (2024). Energy Storage Systems Roadmap. (https://www.epdk.gov.tr/Detay/Icerik/3-0-143/raporlar) 6. Ministry of Energy and Natural Resources. (2022). Turkey National Hydrogen Strategy. (https://enerji.gov.tr/bilgi-merkezi-stratejik-planlar) 7. TÜSİAD. (2023). Decarbonization Roadmap in Turkish Industry. () 8. Ministry of Industry and Technology. (2024). Electric Vehicles and Charging Infrastructure Statistics. (https://www.sanayi.gov.tr/istatistikler) 9. TAYSAD. (2023). Automotive Supply Industry Electrification Roadmap. (https://www.taysad.org.tr/tr/raporlar) 10. TÜBİTAK. (2024). 2024-2030 R&D Roadmap. () 11. TÜSİAD. (2024). Green Transformation and Business World. (https://tusiad.org/tr/yayinlar/raporlar) ¹ Ministry of Environment, Urbanization and Climate Change, “Türkiye’s 2053 Long-Term Climate Change Strategy to Be Announced at COP29,” accessed 7 May 2025. ² Republic of Türkiye, Türkiye Long-Term Climate Strategy , 11 November 2024. ⁵ Sinan Ülgen and Alina İltutmuş, Türkiye’nin İlk İklim Kanunu , EDAM, March 2025, p. 6. ⁶ Sabancı University Istanbul Policy Center, Public Policy and Cultural Narratives in a Global Europe , 29 March 2024, p. 3. ⁷ Ibid. ⁸ Ibid. ⁹ See relevant U.S. executive orders, 2025. ¹⁰ Global Climate Policy Institute, Geopolitics of Net-Zero , 2025. ¹¹ Ibid. ¹² European Commission, “Budget Re-Prioritisation Brief,” 2025.

Turkey stands at a critical crossroads in its energy and economic development. As one of the fastest-growing energy markets among OECD countries with electricity demand growing significantly over the past two decades, the nation faces a fundamental challenge: balancing rapid economic growth with high energy import dependency that threatens its economic stability. This strategic predicament has made energy transition not merely an environmental aspiration but an economic imperative for Turkey's future prosperity and security. The Import Dependency Dilemma Turkey's energy dependency presents one of its most significant economic vulnerabilities. The country currently imports approximately 75% of its total energy needs, creating a structural burden on the economy and exposing it to geopolitical risks. This dependency costs Turkey between $65-90 billion annually representing roughly 20% of its total import bill and contributes significantly to its persistent current account deficit. The stark reality is that Turkey imports 99% of its natural gas and 93% of its petroleum products, making it highly vulnerable to global energy price fluctuations and supply disruptions. According to the Centre for Economics and Foreign Policy Studies, in the 2010s, fossil fuel imports were "probably the largest structural vulnerability of the country's economy" and were a large part of Turkey's debt problems. This vulnerability was starkly demonstrated during recent global energy crises, when price spikes severely impacted the Turkish economy and contributed to inflationary pressures. Diagram by Turkonomics The Renewable Revolution: Progress and Potential Against this challenging backdrop, Turkey has made remarkable strides in renewable energy development. As of 2024, renewables represent 54% of Turkey's installed electricity generation capacity, with 40% of actual electricity produced from renewable sources in 2023. The country has particularly excelled in hydropower development but is now rapidly expanding its wind and solar capacity. Turkey's solar capacity has grown impressively, doubling from 9.7 GW in July 2022 to exceed 19 GW by the end of 2024, surpassing its 2025 target ahead of schedule. This acceleration demonstrates the country's ability to rapidly scale renewable infrastructure when policy and investment conditions align. Wind power, currently at about 12 GW, generates approximately 10.5% of Turkey's electricity, with ambitious plans to reach 30 GW by 2035, including 5 GW offshore. Diagram by Turkonomics The economic case for this transition is compelling. New wind and solar installations are now more economical than running existing coal plants dependent on imported fuel. The LCOE (Levelized Cost of Energy) for solar and wind has fallen dramatically, making renewable energy not just environmentally preferable but economically advantageous. According to industry analyses, every gigawatt of solar power installed saves Turkey approximately $100 million on gas import costs. Coal Dependency: A Transitional Challenge Despite progress in renewables, Turkey faces challenges in reducing its coal dependency. In a surprising development, Turkey overtook Germany in early 2024 to become Europe's largest producer of coal-fired electricity. Coal currently accounts for approximately 35.2% of Turkey's electricity generation, with a concerning trend showing increased reliance on imported coal. This coal dependency complicates Turkey's energy transition and climate commitments. Coal-fired power stations are the largest source of greenhouse gas emissions in Turkey, producing about one tonne of CO2 per person annually. To achieve its 2053 carbon neutrality target, experts suggest Turkey would need to phase out coal power by the mid-2030s. However, the first half of 2024 has shown promising signs. Turkey increased its clean electricity generation by more than 25% compared to the first half of 2023, while cutting fossil fuel-fired output by 9%. Clean power also registered its highest-ever share of Turkey's generation mix during this period, supplying 53% of all electricity, demonstrating that progress is possible with the right policy frameworks and investments. Policy Framework and Investment Landscape Turkey has established several policy mechanisms to accelerate its energy transition. The government has implemented feed-in tariffs, procurement auctions, and subsidies for rooftop solar installations. The National Energy Plan (NEP) sets ambitious targets, aiming for renewable energy to reach 50% of total energy supply by 2030 and 80% by 2053. To meet these targets, Turkey needs to invest approximately $100-110 billion by 2035. According to October 2024 announcements by Energy Minister Alparslan Bayraktar, Turkey is committing to invest $80 billion in renewable energy capacity expansion and an additional $30 billion in grid infrastructure improvements. Recent clean energy investments have shown significant growth, with $4.9 billion invested in 2023, representing a 69% increase from 2022. The current investment climate is increasingly favorable for clean energy, with the government offering attractive incentive packages for renewable energy development. Recent amendments to regulations have been made to complement the government's targets, including measures to encourage domestic renewable energy equipment manufacturing. The Green Industry Project, a government-led initiative, promotes energy and water efficiency in Turkish industries by providing financial incentives to businesses that invest in energy-efficient technologies. This holistic approach recognizes that energy transition extends beyond power generation to encompass industrial transformation and efficiency improvements. Economic Impacts and Future Trajectory The economic benefits of Turkey's energy transition extend far beyond reducing import dependency. Studies suggest that an accelerated transition to renewable energy could generate net socioeconomic benefits estimated at 1% of GDP by 2030. These positive impacts include reduced health and climate change externalities, and wage income growth driven by higher-skilled, better-paid jobs in the clean energy sector. A comprehensive energy transition could potentially reduce Turkey's energy import dependency from 75% to 25%, dramatically improving the country's trade balance and economic resilience. The shift would also position Turkey favorably in relation to carbon border adjustment mechanisms being implemented by trading partners, particularly the European Union. Looking ahead, several factors will determine Turkey's success in this transformation: Grid Modernization:  Studies indicate Turkey could double its planned solar and wind capacity to 40 GW by 2026 with minimal changes to grid operations, though integration of up to 60 GW would require additional investment in transmission infrastructure and system flexibility. Storage and Integration:  The intermittent nature of renewable sources requires investment in energy storage solutions. Turkey has already agreed with Electricity of France (EDF) to develop battery storage systems to help balance grid variations. Financing Mechanisms:  Innovative financial instruments, including green bonds and specialized clean energy funds, will be essential to mobilize the capital needed for this transition. Regulatory Reform:  Continued refinement of energy market regulations, carbon pricing mechanisms, and subsidy structures will be necessary to create a level playing field for renewable energy. Against this backdrop, Turkonomics proposes the following ten-point policy package to accelerate the march toward true energy independence Launch the Turkish Emissions-Trading System (TR-ETS) by 2026. Finalise the Climate Law and set a ₺450 /tCO₂e floor price, recycling 70 % of auction revenue into a Clean Energy Fund for grid and storage projects. Stage annual 5 GW “storage-first” YEKA auctions. From 2025 onward, every winning solar or wind bid must pair at least 20 % of capacity with four-hour batteries, targeting 5 GW of storage online by 2030. Set a transparent coal-exit date of 2040. Publish a binding retirement schedule and create a ₺20 billion Just Transition Fund for mining regions (Zonguldak, Manisa). Turbo-charge rooftop solar. Lift the net-metering cap from 25 kW to 250 kW, grant instant VAT refunds on PV components, and issue a smart-inverter standard by 2026. Mandate near-zero-energy building codes from 2028. All new urban buildings must hit ≤ 45 kWh /m²-year; retrofit 250 000 homes a year using EBRD-backed green mortgages. Green industrial export corridor. Offer 24/7 clean-power contracts to steel, aluminium, and fertiliser exporters so they avoid EU CBAM charges, anchored by Sakarya gas and offshore wind. Build 3 GW of pumped-storage hydro and 300 MW of synchronous condensers. These assets stabilise frequency and absorb surplus solar/wind power. Double cross-border interconnectors to 6 GW by 2035. Fast-track HVDC links to Bulgaria and Greece to monetise surplus renewables and balance peaks. Scale green-hydrogen clusters to 2 GW of electrolysers. Prioritise petrochemicals in Ceyhan and steel in İskenderun; grant a 10-year ₺1.2 /kg H₂ production credit. Electrify transport: 30 % EV share by 2030. Extend the TOGG rebate to imported EVs under €30 000, roll out 120 000 public chargers, and cap fleet averages below 50 g CO₂/km from 2029. The Path Forward Turkey's energy transition represents both a challenge and an opportunity of historic proportions. By accelerating the deployment of domestic renewable resources, especially solar and wind power, Turkey can simultaneously address its energy security concerns, reduce its carbon footprint, create high-value jobs, and improve its economic competitiveness. The progress already achieved tripling renewable electricity generation over the past decade and reaching new clean energy generation records in 2024 demonstrates that this transition is not just possible but already underway. However, the persistence of coal dependency and ongoing investments in fossil fuel infrastructure suggest that the path will not be linear. For Turkey to fully realize the benefits of energy transition, a clear roadmap with binding interim targets, consistent policy support, and substantial public and private investment will be required. The stakes are high: success would mean not just a transformed energy system but a more resilient, independent, and prosperous Turkish economy for generations to come. As Turkey continues to navigate this transition, the government's commitment to renewable energy targets, coupled with favorable economics for clean technologies, provides reason for optimism. The coming decade will be decisive in determining whether Turkey can transform its energy dependency challenge into an opportunity for sustainable economic development and leadership in the clean energy economy.

What did Trump say about NATO? To understand Trump’s impact on US-NATO relations, we must first look at what he said about NATO during his campaign and shortly after his election. Throughout the campaign, Trump accused European countries of failing to meet NATO’s requirement that members spend at least 2% of their gross domestic product (GDP) on defense. Especially before Russia's invasion of Ukraine, many European nations had reduced their defense spending and were falling short of this commitment. The situation had become so dire that in 2019, French President Emmanuel Macron went so far as to claim that NATO was experiencing "brain death." Trump didn’t let up on his criticism and even implied that if the situation didn’t improve, the United States might withdraw from NATO. Table 1:   Displays the defense spending of NATO member countries as a percentage of GDP from 2014 to 2024. European countries, which had long ignored the 2% defense spending rule, were reminded of it following Russia’s attempt to invade Ukraine. According to NATO data, by 2024, 24 member states are now meeting the 2% spending target (Slovakia is exactly at 2%). Trump is elected—what now? After Trump’s election, the world began to wonder how much of his NATO rhetoric he would actually turn into policy, since the actions taken by the United States could directly influence the outcome of the Russia-Ukraine war. Although many European leaders stated that they would continue to support Ukraine regardless of Trump’s decisions, this support alone might not be enough. According to a study by Germany’s Kiel Institute , if U.S. aid to Kyiv is fully withdrawn under a Trump administration, the value of weapons supplied to Ukraine could fall from €59 billion to €34 billion. Table 2: Over the past two years, documents prepared by Trump’s team have mentioned the need for a “radical redirection” of the alliance, referring to NATO as “idle.” They also discuss the possibility of a two-tier alliance structure where members that meet the defense spending requirement would receive more favorable security guarantees from the U.S. To prevent such drastic changes, attention is now focused on the relationship between Trump and NATO Secretary General Mark Rutte. The Mark Rutte–Donald Trump Relationship Trump gave a positive message by holding his first high-level international meeting post-election with newly appointed NATO Secretary General Mark Rutte. In this meeting, a wide range of important issues were discussed, including the 2% contribution rule, relations with Russia, China, and North Korea. From what we know from past experiences and various sources, Rutte and Trump have a good relationship, and Rutte knows how to influence Trump. During his time as Dutch Prime Minister, Rutte’s meetings with Trump were generally positive. Moving forward, Rutte will need to handle his relationship with Trump very carefully. Europe’s Decision Germany has reached the 2% GDP spending goal for the first time since the end of the Cold War, and France has also met the requirement. One of the first steps of the new government to be formed through the coalition between the CDU and SPD will be to increase the defense budget. The UK aims to reach 2.5% as soon as possible. Meanwhile, French President Macron says that the 3.5% target is not unattainable. The European Union, on the other hand, believes it may be able to implement a defense spending plan reaching up to 800 billion dollars. Many countries bordering the conflict zone—such as Estonia, Finland, Romania, Hungary, and Poland—have already increased their defense budgets. NATO data shows Poland is close to reaching a 5% spending rate. According to the Financial Times , European sources claim that Trump wants all European nations to aim for 5% in defense spending. While this is a difficult target to achieve, there is talk of raising expenditures to around 3% or 3.5%. For European countries already struggling with economic problems, this is one of the toughest decisions they will face. Spain, with support from tourism and skilled immigration, is entering a relatively stable economic period compared to others. Therefore, it may change its status as the NATO country with the lowest defense spending in 2024 by the year 2025. This could increase the number of nations responding positively to Trump’s demands, potentially strengthening US-NATO relations. However, Spain has stated that it could reach the 2% spending target by 2029. So, Spain is moving forward modestly and without haste. Conclusion Ending the Russia-Ukraine war is likely to be one of the top priorities for a Trump administration, as well as the tariff issue. One of Trump’s possible strategies could be to increase NATO’s military spending capacity to intimidate Putin. In addition, Trump’s team claims that the burden of global security is being carried by the United States. Therefore, an increase in defense budgets by European countries could help reduce the security burden that the U.S. claims to bear. As we look ahead to uncertain developments, the steps that European countries take regarding their defense budgets will likely play a crucial role in shaping Trump’s decisions and the future of US-NATO relations.

I do not affiliate myself with any political parties or beliefs, and this analysis is presented as an objective examination of Turkey's religious-political landscape. All sources have been thoroughly documented at the end of this article to ensure transparency and factual accuracy. The sources that I have utilized are mostly prestigious institutions however some may lack trust or controversy, I apologize for that. To Begin.. Turkey stands as a unique case study in the complex relationship between religion and politics in the modern world. Officially secular since the founding of the Republic in 1923, Turkey has nevertheless experienced an ongoing negotiation between secular governance and Islamic identity that continues to shape its political landscape. This tension reflects broader questions facing many societies: How does a nation balance religious heritage with modern governance? Can democracy accommodate both secular principles and religious values? What happens when these forces compete for influence over state institutions and social norms? As Atatürk himself (according to Grace Ellison with an interview with him in 1927) declared, “I have no religion, and at times I wish all religions at the bottom of the sea… Superstition must go. Let them worship as they will; every man can follow his own conscience.” This foundational stance contrasts sharply with President Erdoğan’s modern vision of creating a “pious generation” that will “work for the construction of a new civilization.” Between these two positions lies the story of modern Turkey. This article examines the historical evolution of Turkey’s relationship with Islam in the political sphere, from the late Ottoman period through the founding of the secular republic, the multi-party era, the rise of political Islam, and finally the transformation under President Recep Tayyip Erdoğan’s leadership. By understanding this trajectory, we can better comprehend the unique character of Turkish secularism, the resurgence of Islamic politics, and the implications for Turkey’s future. Part I: The Ottoman Legacy and the Birth of Turkish Secularism (1839-1923) The Late Ottoman Period: Seeds of Secularization Long before the Republic of Turkey was established, the Ottoman Empire had begun a gradual process of secularization through the Tanzimat reforms (1839-1876). These reforms, aimed at modernizing the empire and countering European powers’ growing influence, introduced significant changes: The establishment of secular schools alongside traditional religious education Legal reforms including the introduction of commercial and penal codes based on European models The creation of new judicial institutions that limited the scope of Islamic courts Administrative reforms that diminished the ulema’s (religious scholars) traditional authority The reforms represented the Ottoman state’s attempt to adapt to a changing world while preserving its Islamic character. During this period, three main intellectual currents emerged that would influence Turkey’s future relationship with religion: Islamists  who sought to revitalize Islamic institutions while selectively borrowing Western technology Westernists  who advocated for comprehensive adoption of European models including secularism Turkish nationalists  who aimed to forge a distinctly Turkish identity, often with secular leanings The Young Turk Revolution of 1908 and the subsequent Committee of Union and Progress (CUP) government further advanced secularization efforts, bringing religious institutions under greater state control and promoting nationalist ideologies over pan-Islamic unity. Mustafa Kemal Atatürk and Radical Secularization The collapse of the Ottoman Empire after World War I and the subsequent War of Independence (1919-1923) created the conditions for a more radical break with the Islamic past. Mustafa Kemal Atatürk, the republic’s founder and first president, implemented sweeping reforms that fundamentally altered the relationship between religion and state: Abolition of the Caliphate (1924) : Ended the symbolic leadership of the Muslim world that had been held by Ottoman sultans Dissolution of religious orders (1925) : Banned Sufi brotherhoods and closed their facilities Adoption of the Swiss Civil Code (1926) : Replaced Islamic family law with secular legal codes Constitutional secularism (1928/1937) : Removed Islam as the state religion and formally established laicism as a constitutional principle Educational reforms : Unified education under state control, eliminated religious schools, and adopted the Latin alphabet Cultural reforms : Banned traditional religious garb in public offices, introduced Western calendar and time systems, and changed the weekly holiday from Friday to Sunday Atatürk’s views on religion were blunt and uncompromising. He famously declared, “I have no religion, and at times I wish all religions at the bottom of the sea… Superstition must go. Let them worship as they will; every man can follow his own conscience.” He maintained that religion was “between an individual and God” and warned against political exploitation of faith, quipping that evil people were those who “use religion for their own benefit.” In practice, Atatürk’s regime adopted a strict, French-style secularism (laïcité): the state actively intervened to “secularize society by imposing a way of life that had no visible trace of traditional religion,” as later scholars have noted. The Turkish model of secularism, known as laiklik (derived from the French laïcité), differed significantly from Anglo-American secularism. Rather than creating a separation that allowed religious freedom, Turkish secularism involved state control over religious expression and institutions. The Directorate of Religious Affairs (Diyanet) was established to regulate and supervise religious activities, effectively bringing Islam under state authority. Part II: Contested Secularism in the Multi-Party Era (1950-1980) Democratic Party and the First Religious Revival The transition to multi-party democracy in 1946 and the Democratic Party’s electoral victory in 1950 marked the beginning of a new phase in Turkey’s religious politics. The Democratic Party (DP), under Adnan Menderes, did not openly challenge Kemalist secularism but adopted a more accommodating approach to religious sentiment: Reintroduced Arabic call to prayer (previously banned) Expanded religious education in schools Increased funding for mosque construction Relaxed restrictions on religious publications and organizations These policies reflected both electoral calculations and a genuine belief that Atatürk’s radical secularism had gone too far in suppressing Turkey’s religious identity. However, the DP’s decade in power ended with the 1960 military coup, conducted partly in the name of protecting secularism. The Rise of Explicitly Islamic Political Movements The 1960s and 1970s saw the emergence of explicitly Islamic political parties, beginning with the National Order Party (Milli Nizam Partisi) founded in 1970 by Necmettin Erbakan. After its closure by the constitutional court, Erbakan established the National Salvation Party (Milli Selamet Partisi) in 1972. Erbakan’s “National Outlook” (Milli Görüş) ideology combined: - Islamic moral values and identity - Economic development and industrialization - Anti-Western and anti-Zionist positions - Emphasis on Turkey’s Ottoman-Islamic heritage The National Salvation Party participated in several coalition governments in the 1970s, giving Islamists their first experience in governance. This period also saw the growth of Islamic civil society organizations, religious publications, and business networks that would later provide the foundation for political Islam’s expansion. Military Intervention and the “Turkish-Islamic Synthesis” The 1980 military coup, while ostensibly defending secularism, paradoxically facilitated a greater role for Islam in public life. The military junta promoted the “Turkish-Islamic Synthesis” as an ideological bulwark against leftist movements: Introduced compulsory religious education in schools Increased the budget and authority of the Directorate of Religious Affairs Supported the expansion of Imam Hatip religious schools Allowed greater religious content in state media This pragmatic accommodation of religion reflected the military’s view that “controlled religion” could serve as a unifying force and counter to radical ideologies. However, it also created space for the further development of Islamic political and social movements. Part III: The Political Islam Movement and its Transformation (1980-2002) Erbakan’s Welfare Party and the “Just Order” The 1980s economic liberalization under Turgut Özal’s leadership coincided with the growing strength of an Islamic-oriented business class and civil society. These developments created favorable conditions for the rise of Erbakan’s Welfare Party (Refah Partisi), established in 1983. The Welfare Party expanded its support base through: - Efficient grassroots organizations in urban neighborhoods - Social services to the urban poor - Appeals to small and medium business owners - Critiques of Western-style capitalism and secularism The party advocated for a “Just Order” (Adil Düzen) that promised to combine Islamic ethics with economic development while reducing dependence on Western powers and institutions. The Welfare Party’s watershed moment came in the 1994 municipal elections when it won mayoral races in several major cities, including Istanbul (where Recep Tayyip Erdoğan became mayor) and the capital Ankara. This was followed by the party’s victory in the 1995 general elections, leading to Erbakan becoming prime minister in a coalition government in 1996. The “February 28 Process” and the Reconfiguration of Islamic Politics Erbakan’s brief tenure as prime minister (1996-1997) and its aftermath proved pivotal for Turkish political Islam. His government’s perceived challenges to the secular order including proposals for closer ties with Muslim countries, attempts to lift the headscarf ban, and appointments of religious conservatives to bureaucratic positions prompted a harsh reaction from the military and secular establishment. On February 28, 1997, the National Security Council issued a series of ultimatums to roll back Islamic influence in public life, leading to Erbakan’s forced resignation in what became known as the “postmodern coup” or the “February 28 process.” The aftermath included: Closure of the Welfare Party by the Constitutional Court in 1998 Political ban on Erbakan and other party leaders Purges of religious conservatives from the military and civil service Stricter enforcement of the headscarf ban in universities Closure of many Imam Hatip middle schools These events caused a strategic reassessment within the Islamic political movement. A reformist faction led by Erdoğan and Abdullah Gül concluded that direct challenges to Turkey’s secularist establishment were counterproductive and began advocating for a more moderate approach that emphasized democracy, human rights, and economic development rather than explicitly Islamic governance. The Birth of the AKP: Reframing Islamic Politics The split between traditionalists and reformists within the Islamic political movement became formalized with the establishment of two separate parties following the closure of the Virtue Party (Fazilet Partisi, the successor to the Welfare Party) in 2001: The Felicity Party  (Saadet Partisi), which maintained Erbakan’s National Outlook tradition The Justice and Development Party  (AKP), founded by Erdoğan and reformists, which described itself as a “conservative democratic” party comparable to European Christian Democratic parties The AKP strategically avoided explicitly Islamic rhetoric, focusing instead on: - Democratic reforms and EU accession - Economic liberalization and growth - Opposition to military tutelage - Protection of religious freedom within a secular framework This reframing proved electorally successful, allowing the AKP to attract support beyond the traditional Islamist base and win a decisive victory in the 2002 elections with 34.3% of the vote. Part IV: The AKP Era: Conservative Democracy and the Evolution of Turkish Secularism (2002-Present) Early AKP Period: Democratic Reform and Economic Growth The early years of AKP rule (2002-2007) were characterized by significant democratic reforms aimed at EU accession, economic stabilization, and the gradual expansion of religious freedoms: Constitutional amendments reducing military influence in politics Legal reforms improving human rights protections Economic policies that brought rapid growth and reduced inflation Diplomatic initiatives to resolve the Cyprus dispute Incremental steps to ease restrictions on religious expression During this period, the AKP operated within the constraints of Turkey’s established secular system while working to transform it. The government framed its policies not as Islamization but as democratization arguing that true secular democracy required freedom of religious expression, not its suppression. Consolidation of Power and Growing Conservative Influence The AKP’s second term (2007-2011) marked a more assertive phase. After surviving an attempted judicial closure of the party in 2008 and winning a constitutional referendum in 2010 that reformed the judiciary, the government began to implement more openly conservative policies: Attempted lifting of the headscarf ban in universities (2008), which was initially struck down by the Constitutional Court as a violation of secularism Eventual lifting of the headscarf ban in universities and later in public institutions (2013), with Erdoğan triumphantly declaring: “We have abolished an archaic provision which was against the spirit of the republic… Headscarf-wearing women are full members of the republic” Expansion of religious education, including reopening Imam Hatip middle schools Increased restrictions on alcohol sales and advertising Growing religious rhetoric in public discourse Appointment of religious conservatives to key bureaucratic positions Increased budget and authority for the Directorate of Religious Affairs These changes reflected both the government’s increased confidence after electoral successes and the gradual emergence of a new conservative elite in Turkish society educated professionals who maintained their religious identity rather than adopting secular lifestyles. The Post-2013 Period: Authoritarian Turn and Religious Nationalism The Gezi Park protests of 2013 and the subsequent breakdown of the AKP’s alliance with the Gülen movement (a religious community that had previously supported the party) marked another turning point. The government’s response included: Increased emphasis on Ottoman-Islamic heritage and symbols More explicit religious rhetoric and appeals to Islamic solidarity Growing restrictions on opposition media and civil society Promotion of “pious generations” as an educational goal Expanded use of religious symbolism in state ceremonies Erdoğan has openly spoken about his desire to “raise a religious generation” in Turkey, declaring that he aims to create “a generation that will work for the construction of a new civilization.” This vision explicitly intertwines Islamic identity with national purpose and represents a significant departure from Atatürk’s secularist vision. After the failed coup attempt of July 2016, Erdoğan, now president with expanded powers following a 2017 constitutional referendum, embraced a form of religious nationalism that combined Turkish identity, Islamic values, and strong leadership. Symbolic actions during this period included: The conversion of Hagia Sophia from a museum back to a mosque in 2020, which occurred just hours after Turkey’s highest court annulled the 1934 cabinet decree that had designated it a museum The conversion of the ancient Chora Church to a mosque in the same period The expansion of religious education requirements in schools Increased funding for religious institutions and activities (the Diyanet’s budget increased from approximately TL 35.9 billion in 2023 to a staggering TL 91.8 billion in 2024 a 150% increase) Greater prominence of religious ceremonies in state functions Revival of Ottoman commemorations and symbols The government’s approach to secularism evolved from early calls for greater religious freedom toward what some scholars describe as a “post-secular” model where religious values play a more prominent role in public policy and national identity. Part V: Contemporary Dimensions of Religion and Politics in Turkey Religion in the Constitutional Order Turkey’s constitution still defines the state as secular, but the interpretation of this principle has shifted significantly. The AKP government has maintained formal secularism while redefining it to allow greater religious expression and influence in public life. This has created an ambiguous situation where: State institutions remain officially secular Religious education and services receive substantial state funding Islamic symbolism is increasingly incorporated into national identity The Diyanet (Directorate of Religious Affairs) has expanded its role and budget This represents a move away from the strict French-style laïcité toward a model that some scholars compare to the “accommodationist” approach found in Germany or established church arrangements in some European countries. Religious Education and the “Pious Generation” Education has been a central battleground in Turkey’s religious politics. Under AKP governance: Compulsory religious education has been expanded Imam Hatip (religious) schools have proliferated dramatically: from 434 schools with 188,896 students (10.88% of all high school students) in 1996 to 1,693 schools with 514,630 students (10.34% of all high school students) in 2022 Religious content has increased in standard curriculum Alternative theories to evolution have been introduced, with the removal of evolutionary theory from high school biology textbooks in 2017 as part of a new “values-based” curriculum Ottoman history and Islamic civilization receive greater emphasis The 2014 introduction of specialized İmam-Hatip “project schools” further diversified curricula toward religion and Arabic Year IH High School Students IH Students % of All High Schools # of IH High Schools 1996 188,896 10.88% 434 2004 84,898 2.37% 442 2012 285,203 7.02% – 2022 514,630 10.34% 1,693 The number of Imam Hatip schools dramatically declined after the 1997 “postmodern coup,” falling to just 2.37% of all high school students by 2004. The AKP government prioritized rebuilding this religious education infrastructure, returning the percentage to pre-1997 levels by 2022. President Erdoğan has explicitly stated the goal of raising a “pious generation,” reflecting the belief that education should transmit religious and traditional values alongside modern knowledge. One Education Minister justified removing evolution from high school curriculum by stating it was “best left to be taught at the university level; it’s a theory that requires a critical mind.” Women, Gender, and Family Gender relations and family policy have been particularly contentious areas in Turkey’s religious politics: Government promotion of traditional family structures and higher birth rates Debates over women’s participation in the workforce The headscarf issue as a symbol of religious freedom and identity Concerns about the erosion of gender equality in law and practice Conservative rhetoric about gender roles from political leaders Withdrawal from the Istanbul Convention on preventing violence against women (2021) These issues reflect deeper debates about the proper relationship between religious values and gender equality in a modernizing society. Religious Minorities and Pluralism Turkey’s religious landscape extends beyond Sunni Islam to include significant Alevi, Christian, and Jewish communities. The treatment of these minorities provides another lens for understanding Turkish secularism: Ongoing Alevi demands for equal recognition of their religious identity and places of worship The complex status of the Greek Orthodox, Armenian, and other Christian communities Limited progress on property restitution for minority religious foundations Occasional interfaith initiatives alongside persistent discrimination The concept of citizenship increasingly linked to Sunni Muslim identity The treatment of religious minorities highlights the tensions between different conceptions of secularism: one that treats all religions equally versus one that privileges the majority faith while tolerating others. The Diyanet: Religion Under State Control The Directorate of Religious Affairs (Diyanet) represents the distinctive Turkish approach to managing religion. Under AKP rule, the Diyanet has: Seen its budget and staff expand dramatically: in 2023, the Diyanet’s budget was roughly TL 35.9 billion (about USD 1.2 billion), and the approved 2024 budget soared to TL 91.8 billion (USD ~3.2 billion) – a 150% increase Extended its activities internationally to Turkish diaspora communities Taken more conservative positions on religious and social issues Become more closely aligned with government policies Expanded beyond religious services into areas like family counseling and social media This vast budget growth – now exceeding all but a handful of cabinet ministries – underlines the AKP’s prioritization of religious institutions. By comparison, the Diyanet’s funding in the early 2000s was only a few billion TL. The Diyanet exemplifies the Turkish model where secularism means state control of religion rather than separation of religion and state. Ironically, the institution created by Atatürk to contain and regulate religion has become a powerful vehicle for expanding religious influence under the AKP. Islamic Civil Society and Business Beyond formal politics, Islamic influence has grown through civil society organizations and business networks: Faith-based charitable organizations providing social services Islamic business associations like MÜSİAD (Independent Industrialists and Businessmen’s Association) Religious foundations (vakıf) funding education and cultural activities Islamic media outlets and publishing houses Growing “halal” economy including Islamic banking, modest fashion, and halal tourism Interest-free banking has grown into a sizable sector. Today Turkey has several major participation banks (Albaraka Türk, Kuveyt Türk, Vakıf Katılım, Türkiye Finans) alongside smaller institutions. Their combined assets have expanded rapidly, with funds collected by participation banks jumping from about TL 39 billion in 2011 to TL 322 billion in 2020. As a share of the banking system, Islamic banks held roughly 9% of total banking assets by 2023. This growth reflects political backing and customer demand among conservative Turks who prefer sharia-compatible finance. Since the 1980s, a new class of conservative entrepreneurs has emerged. Dubbed “Anatolian Tigers” (Anadolu Kaplanları) or “Green Capital” (yesil sermaye), these are often Sunni businessmen from central provinces (Konya, Kayseri, Gaziantep, Malatya) who broke into manufacturing and exporting. They built textile mills, furniture factories, and food industries, often reinvesting profits into pious charities and avoiding interest. Their provinces have steadily increased their share of national output and exports in recent decades. These developments have created an infrastructure for Islamic influence that operates partly independently of state power. The rise of this “green capital” illustrates the AKP era’s interplay of faith and profit: banks, factories, and construction companies financed by religious conservatives thrive under an AKP that encourages both Islam and capitalism. Part VI: International Dimensions and Comparisons Turkish Secularism in Global Context Turkey’s experience with secularism and religious politics can be compared to several other models: French laïcité with its emphasis on removing religion from public life American secularism based on separation of church and state with religious freedom “Twin tolerations” model where democracy requires both religious actors accepting democratic principles and the state allowing religious expression “Multiple secularities” framework recognizing different historical paths to secular governance Turkey’s model of secularism has been distinctive. As one analyst summarized, “the main concern of Turkish secularists was freedom from religion, and almost never freedom of religion.” The Constitutional Court has repeatedly emphasized that Turkish secularism “has a historical particularity” different from Western models. For instance, in a landmark 1991 ruling, it invalidated a parliamentary law easing headscarf restrictions, stating that permitting scarves would violate laiklik. More recently, Turkey has moved away from strict French-style laïcité toward a model that some scholars compare to the “accommodationist” approach found in Germany or established church arrangements in some European countries. This shift represents what experts call “another moment in which the definitions of secularism and the relationship between government, religion, and the public sphere are all in flux.” Turkey’s evolving approach demonstrates that secularism is not a fixed concept but a contested principle that develops differently according to historical, cultural, and political factors. Religion in Turkish Foreign Policy Religious identity has become increasingly significant in Turkey’s foreign relations: Advocacy for Muslim causes in international forums Support for Muslim minority communities worldwide Religious diplomacy through the Diyanet and Turkish aid agencies Complex relations with other Muslim-majority countries Religious dimensions of regional conflicts Tensions with Western allies over religious freedom issues This represents a departure from the strictly secular foreign policy of earlier republican periods toward what some analysts call “neo-Ottomanism” a more multidimensional approach that incorporates Islamic solidarity alongside national interests. Rather than a simple narrative of secularization or Islamization, Turkey represents a complex case of ongoing negotiation between these forces. The country’s experience raises important questions about the compatibility of democracy, secularism, and religious values that resonate far beyond its borders. The future trajectory of religious politics in Turkey will depend on many factors: - The sustainability of the AKP’s conservative democratic model - Economic performance and social development, Generational changes in religious practice and identity - Regional dynamics and international influences ,The resilience of secular opposition What seems certain is that the relationship between religion and politics will remain central to Turkey’s national identity and democratic development for the foreseeable future. Sources: Ipsos Global Advisor – Global Religion 2023 Report (May 2023)   Ipsos Ipsos Global Advisor – Religion 2023 Master Press Release (May 2023)   Ipsos Turkish Statistical Institute (TÜİK) – İmam Hatip Lisesi İstatistikleri   TÜİK Veri Portalı Diyanet İşleri Başkanlığı – 2023 Kurumsal Mali Durum ve Beklentiler Raporu   stratejigelistirme.diyanet.gov.tr Diyanet İşleri Başkanlığı – 2024 Kurumsal Mali Durum ve Beklentiler Raporu   stratejigelistirme.diyanet.gov.tr BrainyQuote – Mustafa Kemal Atatürk Quote: “I have no religion, and at times I wish all religions at the bottom of the sea.”   BrainyQuote Goodreads – Andrew Mango, Atatürk: The Biography of the Founder of Modern Turkey  (quote collection)   Goodreads UNESCO – “Hagia Sophia: UNESCO deeply regrets the decision of the Turkish authorities…” (10 July 2020)   UNESCO World Heritage Centre NPR – “In Turkey, Schools Will Stop Teaching Evolution This Fall” (20 August 2017)   NPR Wikipedia – Turkish textbook controversies   Vikipedi Wikipedia – Religion in Turkey   Vikipedi Optimar Araştırma, “Gençlik ve Din: Türkiye Raporu 2019” (June 2019). https://optimar.com.tr/wp-content/uploads/2019/07/2019-Genclik-ve-Din-Raporu.pdf Pew Research Center, “Religion in Turkey: A 2019 Global Attitudes Study” (December 2019). https://www.pewresearch.org/religion/2019/12/19/religion-in-turkey/ 1926-27 yıllarında Atatürk ile röportaj yapan Grace Ellison'ın 1928 yılında yayımlanan "Turkey Today" adlı kitabı KONDA Research & Consultancy, “How Religious Are We? 10-Year Trends in Religious Orientation” (December 2018). https://konda.com.tr/en/comprehensive-reports Milli Eğitim Bakanlığı (MEB), “2021–2022 Eğitim Yılı İmam Hatip Liseleri İstatistikleri” (September 2022). https://yigm.meb.gov.tr/meb_iys_dosyalar/2022_istatistik/ihl_2021-2022.pdf Milli Eğitim Bakanlığı (MEB), “2023–2024 Eğitim Yılı İmam Hatip Liseleri İstatistikleri” (September 2024). https://yigm.meb.gov.tr/meb_iys_dosyalar/2024_istatistik/ihl_2023-2024.pdf France : Loi du 9 décembre 1905 sur la séparation des Églises et de l’État. https://www.legifrance.gouv.fr/loda/id/JORFTEXT000000319474/ Germany: Grundgesetz für die Bundesrepublik Deutschland, Artikel 140. https://www.gesetze-im-internet.de/gg/art_140.html Carnegie Endowment for International Peace, Kemal Kirişci, “Turkey’s Evolution in the Middle East” (2023) – discusses use of religious soft powerhttps:// carnegieendowment.org/2023/06/12/turkey-s-evolution-in-middle-east-pub-89402 Brookings Institution, Sinan Ülgen, “Between Isolate and Integrate: Turkey’s Foreign Policy Dilemma” (2021) – analyses Diyanet’s diplomatic rolehttps:// www.brookings.edu/articles/between-isolate-and-integrate-turkeys-foreign-policy-dilemma/ Chatham House, “Turkey’s Soft Power Strategy” (2022) – includes a section on religious diplomacyhttps:// www.chathamhouse.org/2022/turkey-soft-powerstrategy https://www.ipsos.com/en/two-global-religious-divides-geographic-and-generational#:~:text=generations%20in%20the%20prevalence%20of,or%20of%20some%20other%20faith

Analysis of European Union Structure The European Union (EU) represents one of the most complex political and economic partnerships in the world, comprising 27 member states as of October 2023. This analysis provides an in-depth look at the structure of the EU, detailing its institutions, decision-making processes, and the challenges it faces in an increasingly multipolar world. Historical Context The EU's structure is deeply rooted in the aftermath of World War II, as European countries sought to foster economic cooperation, prevent further conflicts, and promote political integration. The foundational treaties most notably the Treaty of Rome (1957) and the Maastricht Treaty (1992)laid the groundwork for an integrated Europe. The Lisbon Treaty (2009) further refined the workings of the EU, enhancing its institutional framework. Institutional Framework The EU's structure is characterized by a unique blend of intergovernmental and supranational elements, facilitated by a set of key institutions: • The European Commission The European Commission serves as the executive body of the EU, where it proposes legislation, implements decisions, and upholds EU treaties. Comprising 27 Commissioners, one from each member state, the Commission plays a central role in drafting policies related to trade, environmental standards, and consumer protection. The President of the Commission, currently Ursula von der Leyen, is crucial in setting the policy agenda and representing the EU internationally. Functions: 1. Legislation Initiator: Proposes laws and policies. 2. Policy Implementation: Responsible for executing EU laws and policies. 3. Guardian of Treaties: Ensures that member states abide by EU law. • The European Parliament As the directly elected legislative body, the European Parliament represents the interests of EU citizens. It consists of 705 Members of Parliament (MEPs) elected every five years. The Parliament shares legislative power with the Council of the European Union and plays a significant role in shaping laws, approving the budget, and holding the Commission accountable. Function: 1. Legislative Power: Co-decision with the council on proposed legislation. 2. Budgetary Authority: Adopts or amends all the annual budget and expenditure plans. 3. Democratic Oversight: Conducts inquiries and oversees the work of the commission. • The Council of the European Union Often referred to as the Council of Ministers, this body represents the governments of each member state. The Council's composition changes depending on the topic being discussed, allowing for collaboration across various sectors, such as health, finance, or agriculture. It shares legislative power with the European Parliament, making decisions through a complex system of voting that often requires a qualified majority. Functions: 1. Legislative Role: Reviews and negotiates legislation proposed by the commission. 2. Policy Coordination: Coordinates policies among member states. 3. Decision Making: Often acts in conjunction with the EP in a co-decision procedure. • The European Council The European Council consists of the heads of state or government of member countries, along with the President of the European Council and the President of the European Commission. This body defines the EU's overall political direction and priorities, serving as a strategic forum where member states negotiate consensus on significant issues. Functions: 1. Strategic Guidance: Sets the EU’s overall political direction. 2. Crisis Management: Addresses significant issues affecting the union. • The Court of Justice of the European Union (CJEU) The CJEU ensures the uniform interpretation and application of EU law across member states. It adjudicates disputes involving EU institutions, member states, and citizens, ensuring compliance with EU treaties. Its rulings are binding, resulting in a legal framework that underpins the EU's operations. Functions: 1. Legal Interpretation: Interprets EU law and ensures its uniform application. 2. Dispute Resolution : Resolves disputes between institutions ,member states and individual regarding EU law. Diagram 1:EU Institutional Structure Decision-Making Process The EU employs a multi-layered decision-making process characterized by: Legislative Initiatives: European Commission initiates legislation, which must then be approved by both the European Parliament and the Council of the European Union. Qualified Majority Voting: In many policy areas, decisions are made through Qualified Majority Voting (QMV), requiring a majority of votes weighted by population size. Consensus and Compromise: Given the diverse interests of member states, the decision-making process often involves extensive negotiation and compromise to reach an agreement. Diagram 2: Ordinary Legislative Procedure Challenges and Critiques Despite its robust structure, the EU faces several challenges: 1. Democratic Deficit Critics argue that the EU suffers from a democratic deficit, where decisions are made by bureaucrats disconnected from citizens preferences. Although the European Parliament is elected, many EU policies and decisions occur behind closed doors, raising concerns about transparency and public accountability. 2. National Sovereignty vs. Supranational Authority Member states often grapple with the balance between maintaining national sovereignty and ceding powers to the EU. This tension manifests in contentious debates over issues like fiscal policy, immigration management, and environmental regulations. 3. Expansion and Integration The enlargement of the EU poses challenges in terms of integration. New member states often bring varying degrees of readiness and differing political landscapes, complicating the pursuit of a unified policy framework. 4. External Relations The rise of populism, along with geopolitical tensions with nations such as Russia and China, challenges the EU's capacity to present a unified external policy. Divergent foreign policy priorities among member states can weaken the EU's bargaining power on the global stage. Conclusion The European Unions structure is intricate, blending intergovernmental and supranational elements while adapting to the needs and aspirations of its diverse member states. It has successfully fostered peace and economic cooperation across Europe, but it is not without challenges. The EU must navigate the complexities of democratic engagement, sovereignty considerations, and external pressures, all while striving for deeper integration and sustainability. As the EU evolves, its ability to adapt its structures and processes in response to both internal and external challenges will determine its future relevance and effectiveness in an increasingly multipolar world.

Reading capital mCapital Mobility and Culture: Beyond Economic Rationalityovements solely through market rules or rational individual assumptions oversimplifies the matter. This is because capital often finds its counterpart in society's historical memory, cultural codes, and even religious references. In this regard, I would like to summarize and convey my observations about how capital exists not only as an economic phenomenon but also as a social subject. The "homo economicus" assumption in neoclassical economic theory positions individuals as rational actors trying to maximize their utility. However, in the real world, the factors that shape capital movements are too complex and multidimensional to be expressed in mathematical models. Frankly speaking, it is quite ironic that this reductionist approach still prevails in the discipline of economics. Douglass North's institutionalist approach shows us that capital is shaped not only by law but also by tradition, belief, and trust relationships. The "path dependency" phenomenon emphasized by North explains why capital does not function the same way in every society. This becomes particularly evident in social structures like Turkey, where traditional and modern dynamics are intertwined. The Difference in Capital Formations in Turkey In the case of Turkey, conservative capital structures that have developed in Central Anatolia appear not only as an economic choice but also as a community, a sense of belonging, and a way of life. Here, capital operates within a solidarity network interwoven with religious discourse, hometown ties, and local values. This capital structure, referred to as "Anatolian Tigers" after the 1980s, has gathered around organizations like MÜSİAD, becoming a manifestation of shared value systems and worldviews. In regions like Marmara, however, capital advances on a more secular, individualistic, and competitive path. This capital fraction, organized under the TÜSİAD umbrella, has a character more compatible with the founding ideology of the Republic, oriented towards the West, and maintains closer relationships with international finance and trade networks. This difference tells us: The movement of capital is related not only to "how much profit it brings" but also to "how it is legitimized in which cultural ground." Social Capital and Collective Solidarity Especially since the 2000s, solidarity mechanisms of local capital groups have gained importance in the face of neoliberal policies that began to find a space for themselves in Turkey. This phenomenon, termed "social capital" in economic terminology, refers to the effect of social networks, norms, and trust relationships on economic development. As emphasized in Robert Putnam's studies, communities with high social capital solve collective action problems more easily and reduce transaction costs. In capital mobility in Turkey, social capital built through hometown ties and religious communities has played a critical role in the success of rising capital groups, especially in Anatolian cities. In this respect, the sources of legitimacy for capital also show regional and cultural differences. While emphasis on "halal earnings" compatible with Islamic values is an important source of legitimacy in conservative capital circles, Western standards and global integration are more important in secular capital circles. Distribution of Industrialists and Businessmen Associations in Turkey on a Provincial Basis(February 2025) Embedded Economy and Social Context The concept of "embedded economy" put forward by Karl Polanyi in his work "The Great Transformation" emphasizes that economic activities cannot be isolated from the network of social relations. According to Polanyi, market society is a modern invention, and historically, economic activities have always been "embedded" in social, political, and cultural contexts. Of course, changes in political and social perspectives have also transformed capital structuring. Today, businesses in Turkey are in search of not only profit maximization but also social responsibility, sustainability, and cultural legitimacy. This transformation raises questions about whether traditional forms of capital are changing or values are being disregarded. The Relationship Between Capital and Public Space Although the concept of capital is interpreted as an accumulation or dynamic system, in Turkey, this situation also brings about an essential and public integration. Criticisms in the past that capital was monopolized by certain segments and that the countryside was kept outside the public structure have now given way to a more inclusive understanding of capital. This is because at the core of capital lies the idea that no region is superior to another and that everyone should have equal opportunities. I believe that the reasons for our society's propensity for economic polarization and our proximity to public capital can be clarified by experts conducting a political-economic survey of approximately 250 years, beyond the recent economic history of the Republic of Turkey. The fact that capital is limited to formal institutions or laws, that is, the lack of social conscience, could be a valid reason for conducting this survey. Conclusion: The Social Dimension of Capital Therefore, capital transforms into a social subject as much as it is an economic object. This perspective helps us better understand the interaction between economic development and capital formations with cultural values. To understand capital movements, we need a multidimensional analytical framework that includes historical, sociological, and anthropological perspectives instead of the reductionist approaches of neoclassical economics. With these feelings and thoughts, I emphasize the necessity of considering capital not only as an economic but also as a social and cultural phenomenon.

California's economy has officially surpassed Japan's, making the Golden State the fourth largest economy in the world, according to recent data from the International Monetary Fund and the US Bureau of Economic Analysis. The state's nominal GDP reached $4.1 trillion in 2024, edging out Japan's $4.02 trillion. This historic milestone positions California behind only the United States ($29.18T), China ($18.74T), and Germany ($4.65T) in global economic rankings. "California isn't just keeping pace with the world – we're setting the pace. Our economy is thriving because we invest in people, prioritize sustainability, and believe in the power of innovation," Governor Gavin Newsom said in a statement announcing the achievement. Remarkable Growth Rate California's economy isn't just large, it's also growing faster than other major economies. The state posted a remarkable 6% growth rate in 2024, outpacing the United States (5.3%), China (2.6%), and Germany (2.9%). Meanwhile, Japan's economic output remained essentially flat, with its GDP in dollar terms declining as the yen weakened and its population decreased. Key Drivers of California's Economic Success California's economic expansion has been broad-based across multiple sectors: Technology and Innovation Silicon Valley and the San Francisco Bay Area remain global hubs for technological innovation. In 2024, Bay Area startups attracted $90 billion in venture funding, representing 57% of all US venture capital investment. California startups raised nearly 49% of all US VC funding in 2024, fueling innovation in software, biotechnology, artificial intelligence, and cloud computing. Diverse Economic Base While technology is a major driver, California's economy is powered by multiple sectors: Tech industry : Home to giants like Apple, Google, Meta, and Nvidia Entertainment : Hollywood remains a global cultural export powerhouse Agriculture : California is the nation's largest agricultural producer Clean energy : The state employs approximately 545,000 workers in clean-energy and clean-vehicle industries Tourism : Travel spending hit $150.4 billion in 2023, a record above pre-pandemic levels Trade Performance California engaged in $675 billion in two-way trade last year. In 2024, the state's goods exports totaled approximately $183.3 billion, with computer and electronic products ($47.9B) being the largest category. Key export markets included Mexico ($33.5B), Canada ($18.4B), and various Asian countries (nearly $71.9B total). Population and Workforce Dynamics California's population, which rebounded by approximately 250,000 people in 2024 to nearly 40 million, has played a crucial role in its economic growth. The state's labor market grew by roughly 30% or 4.2 million jobs, between 1998 and the second quarter of 2024. Meanwhile, Japan's workforce has been shrinking due to demographic challenges, contributing to its economic stagnation. The Role of Monetary Factors Several monetary factors have also influenced California's rise in the rankings: Exchange rates : The yen's weakness against the dollar has reduced the U.S. dollar value of Japan's output Interest rates : The U.S. Federal Reserve's higher interest rates (around 5.25-5.50%) have strengthened the dollar, while the Bank of Japan only recently ended negative rates Inflation : U.S. inflation has moderated to about 2.4% in early 2025, while Japan's has exceeded 3% for most of 2024-25 Challenges and Threats Despite this milestone, California's economic position faces several challenges: Tariff Tensions President Trump's tariff policies could significantly impact California's trade relationships. Last week, Governor Newsom announced a lawsuit challenging Trump's executive authority to enact international tariffs without congressional support, calling the president's economic policies a "wrecking ball" to America's global reputation. Regional Inequality California is grappling with deep financial inequalities between its regions. In 2023, the Bay Area's per capita income was $131,000, more than double that of the Inland Empire and Central Valley. Housing and Infrastructure The chronic problems of housing unaffordability, homelessness, and delayed infrastructure improvements remain significant barriers to further growth. Competition from India India's economy, currently at $3.90 trillion, is predicted to overtake California's by 2026, according to current data trends. Looking Forward California's rise to become the world's fourth-largest economy represents a significant achievement, reflecting the state's diverse economic strengths and innovative capacity. However, maintaining this position will require addressing internal challenges while navigating an increasingly complex global trade environment. The milestone comes six years after California surpassed the United Kingdom to become the world's fifth largest economy in 2018, demonstrating the state's continued economic momentum despite various headwinds. "California's economy powers the nation, and it must be protected," Newsom emphasized while acknowledging both the achievement and the challenges ahead.

Political polarization has become one of the defining features of modern democracies worldwide. From the United States to Turkey to Italy, the widening gap between political factions isn't just creating social tension, it's directly impacting your wallet. Recent research reveals a disturbing correlation: as political divisions deepen, economic growth slows, investments dry up, and inflation volatility increases. This article explores the concrete ways in which political polarization leads to economic decline and why voters across the political spectrum end up poorer. Diagram by Turkonomics. The Polarization-Poverty Connection Measuring the Impact According to the Philadelphia Federal Reserve's Partisan Conflict Index, political polarization remained relatively stable in the United States from 1981 to 2008. However, since 2008, the index has surged dramatically, peaking at record levels in 2017 and again in 2023. Joan Esteban When we overlay political polarization data with economic growth rates across countries, a clear pattern emerges: Countries in the highest quintile of political polarization (shown in red on the political polarization map) consistently demonstrate lower GDP growth rates Nations with moderate polarization (shown in yellow and orange) maintain more stable economic trajectories The relationship is particularly pronounced in developing economies Diagram by Turkonomics. Real-World Economic Consequences 1. Currency Volatility and Inflation A cross-national study of 85 countries found that ideological polarization increases inflation volatility by 1.2–1.8 percentage points. Turkey provides a striking example: between 2018 and 2021, the Turkish lira lost 40% of its value against the dollar amid clashes between President Erdoğan's AKP and opposition parties over central bank independence. The resulting erratic interest rate policies led to annual inflation rates exceeding 30%. 2. Investment Paralysis When political factions cannot agree on basic economic policies, businesses delay investments: In the United States, the 2011 debt ceiling crisis triggered an 18% plunge in the S&P 500 and cost an estimated $1.3 billion in higher borrowing costs Cross-national data reveals that a 10% increase in legislative gridlock correlates with a 0.6% decline in GDP growth During Brexit negotiations (2016-2019), foreign direct investment in the UK fell by 30% as companies postponed expansions pending trade rule clarity 3. Fiscal Mismanagement Polarized governments often resort to short-term populist policies that undermine long-term economic stability: Brazil's public debt ballooned to 90% of GDP by 2019 during the politically turbulent Rousseff-Temer-Bolsonaro era Argentina's chronic deficit spending, driven by Peronist-opposition divide, pushed inflation above 100% in 2023 Italy's fragmented coalition governments have contributed to anemic 0.5% annual GDP growth since 2000, the lowest in the eurozone The Mechanisms: How Politics Impacts Your Wallet Policy Uncertainty When polarized legislatures fail to pass budgets or renew tax codes, businesses face regulatory ambiguity: An IMF study found that countries in the top quartile of legislative gridlock experience 23% lower private investment The U.S. Tax Cuts and Jobs Act of 2017, passed without bipartisan support, led 40% of firms to halt expansion plans due to uncertainty over sunset provisions Institutional Erosion Political polarization undermines trust in nonpartisan institutions: Turkey's dismissal of three central bank governors between 2019 and 2021 led to loss of investor confidence and 30% annual inflation Political attacks on the Federal Reserve during the Trump administration correlated with a 15% increase in stock market volatility Debt Ceiling Drama The recurring U.S. debt ceiling crises exemplify how polarization creates economic costs: The 2013 government shutdown reduced quarterly GDP growth by 0.3% By 2023, chronic gridlock contributed to a 20% increase in Treasury bond yields, raising mortgage rates Markets now routinely price in a 25% probability of default during debt ceiling negotiations The Income Inequality Connection Research by Ray Dalio of Bridgewater Associates reveals a critical feedback loop between political polarization and income inequality. When the share of national income earned by the ultra-wealthy 0.1% approaches that of the working class 90% (as occurred in the 1920s and again by 2008), political conflict intensifies. Diagram by Turkonomics. This feedback loop leads to: Economic policies driven by partisan revenge rather than efficiency Volatile swings between redistributive and pro-business regimes Disrupted long-term planning for both businesses and households As Marina Azzimonti's research at the Philadelphia Federal Reserve shows, high "partisan conflict" scores correspond with periods of intense anxiety concerning lower and middle class incomes. The wealthy 0.1% earned as much income as the working class 90% during much of the 1910s and 1920s. This massive disparity only reversed following the Great Depression, Roosevelt's redistribution of wealth, and the onset of World War II. By the mid-1980s, the "many" were earning 35% of the nation's income while the "few" were earning less than 10%, the closest to equality in the 20th century. However, another shift toward inequality began in the 1980s as businesses replaced expensive U.S. labor with cheaper offshore workers or automation. By 2008, income shares returned to 1920s levels, and working class anxiety about the future surged, along with political polarization. Anecdote: Mehmet Yılmaz had operated his small bakery in Istanbul's Kadıköy district for over fifteen years. Every morning at 4 AM, he would arrive to prepare the day's fresh bread, simit, and börek that his loyal customers depended on. But on a cold morning in December 2021, Mehmet stared in disbelief at his latest flour invoice. The price had nearly doubled overnight. "First it was the flour, then the sugar, then the electricity," Mehmet recalls. "Within three months, my costs tripled, but I couldn't triple my prices or I'd lose all my customers." Like thousands of small business owners across Turkey, Mehmet found himself caught in the crossfire of macroeconomic forces beyond his control. As the Turkish lira plummeted amid political battles over central bank policy, everyday entrepreneurs like Mehmet bore the brunt of the resulting inflation. "I don't care about politics," he says, "but somehow politics started caring about my bakery." Global Perspectives: Lessons from Abroad United States: Debt Ceiling Crises and Market Shocks Repeated government shutdowns and debt limit standoffs since 2008 have become hallmarks of U.S. polarization. The 2013 shutdown, driven by Republican opposition to the Affordable Care Act, reduced quarterly GDP growth by 0.3% and delayed $4 billion in federal contracts. By 2023, chronic gridlock had contributed to a 20% increase in Treasury bond yields, raising mortgage rates and cooling housing markets. Turkey: Currency Crisis and Inflation Turkey's experience demonstrates how polarization directly impacts household finances. The dismissal of three central bank governors between 2019 and 2021, for resisting politically motivated rate cuts, led to a loss of investor confidence and a 30% annual inflation rate. The lira's 40% depreciation against the dollar increased import costs, driving up prices for everyday consumer goods and eroding purchasing power. Italy: Fragmentation and Stagnation Italy's proportional electoral system has perpetuated coalition governments prone to infighting. The 2018-2019 standoff between the Five Star Movement and the Democratic Party delayed adoption of EU-mandated budget reforms, resulting in a 2.4% contraction in industrial production and a widening bond yield spread over German bunds. Chronic instability has contributed to Italy's anemic 0.5% average annual GDP growth since 2000. Brazil: Fiscal Instability and Investor Flight Brazil's political turmoil during the Rousseff-Temer-Bolsonaro era saw public debt balloon to 90% of GDP by 2019. Legislative opposition to austerity measures prompted Moody's to downgrade Brazil's sovereign rating to junk status, triggering a 12% stock market crash. Polarization also fueled corruption scandals that deterred foreign direct investment, which fell by 45% between 2014 and 2018. Solutions: Breaking the Cycle Diagram by Turkonomics. Electoral Reform Shifting from first-past-the-post to ranked-choice voting could reduce legislative fragmentation Nonpartisan redistricting commissions can limit gerrymandering Australia's experience shows how ranked-choice voting mitigates far-right influence and maintains more consistent economic policies Institutional Independence Strengthening independent budget offices insulates fiscal policy from electoral cycles Protecting central bank autonomy prevents monetary policy politicization Germany's independent Bundesbank and robust bureaucratic institutions demonstrate the benefits of this approach Civic Education Promoting understanding of economic interdependence can moderate extreme positions Cross-partisan dialogue initiatives can rebuild social trust Finland's media literacy programs have helped citizens identify polarizing misinformation and reduce societal divisions Political polarization imposes a measurable economic tax on citizens across the political spectrum. From heightened inflation volatility to depressed investment and fiscal instability, divisions in the political arena translate directly into diminished prosperity. The economic benefits of reduced polarization are substantial: potentially +0.6% higher GDP growth, +23% increased investment, and -1.5 percentage point lower inflation volatility. While addressing polarization requires cross-party consensus a formidable challenge in itself, the economic costs of inaction grow daily. Whether you lean left or right, the evidence is clear: political polarization makes everyone poorer. This article draws on data from the Philadelphia Federal Reserve's Partisan Conflict Index, cross-national studies by the IMF, and research by economists Marina Azzimonti and Ray Dalio.

Berlin’s decision to block the sale of 40 Eurofighter Typhoon jets to Türkiye, announced only weeks after the controversial arrest of Istanbul’s opposition mayor Ekrem İmamoğlu, has detonated a three‑way crisis: inside Germany’s new “values‑based” foreign‑policy experiment, inside NATO’s already strained cohesion, and inside Europe’s own quest for a common defence market. What follows is a critical tour of the fallout, told through five lenses that all converge on a single question: can Europe defend both its principles and its security when those principles clash with the policies of a pivotal ally? Why The Eurofighters So Important: Türkiye’s air force is living off an ageing fleet of 240 F‑16C/Ds, most delivered before smartphones existed. Athens, meanwhile, now fields Rafales and upgraded F‑16V Vipers. Ankara’s plan to buy 20 early‑build Typhoons from London and 20 state‑of‑the‑art Tranche 4 aircraft from the Eurofighter consortium would have restored a semblance of parity especially with the Meteor BVRAAM and Paveway IV precision kit the Typhoon can carry. Excluding Türkiye from the F‑35 programme in 2019 over its S‑400 deal left a stealth‑capability chasm that the KAAN (Türkiye’s indigenous 5th‑gen fighter) will not fill before the early 2030s. Defence Minister Yaşar Güler calls the Eurofighter purchase the “bridge” that keeps Turkish deterrence credible until KAAN squads go operational. Berlin just kicked away half that bridge. Political context: On 19 March 2025, Turkish prosecutors detained İmamoğlu on corruption and terrorism charges. Critics call it corrupt using pliant courts to erase an electoral rival before the 2028 presidential race. The symbolism could hardly be clearer, Istanbul alone generates nearly one‑third of Türkiye’s GDP, and the mayor who beat Erdoğan’s party twice now sits behind bars. Germany, long Türkiye’s biggest EU critic on rights issues, chose this moment to redraw its own red lines. Foreign Minister Annalena Baerbock declared İmamoğlu’s detention “a systemic assault on democratic norms”, then linked that assault to the EU’s 2008 arms‑export guidelines, effectively slamming the Typhoon hangar doors shut. Behind the lofty language lies brutal coalition arithmetic. The SPD needs to prove its human‑rights bona fides to left‑leaning voters; the Greens, though outside government, have enough seats to tank climate bills if their ethical demands are ignored. Bavarian conservatives warn of lost Airbus jobs, defence‑industry lobbyists plead for predictability, and security hawks fear pushing Türkiye toward Moscow. The result: a grand  coalition that looks anything but, muddling through with a “veto first, debate later” reflex that satisfies moralists in Berlin and Paris but also confirms every Turkish suspicion that Europe uses double standards when it suits domestic politics. Eurofighter is already fighting for relevance against France’s export‑savvy Rafale and the omnipresent F‑35. Every additional order funds the Long‑Term Evolution upgrade that keeps the jet competitive. Germany’s veto therefore hurts not only Türkiye, but also Spain, Italy, and the UK partners who signed a framework agreement requiring unanimous  export approval back in 1998. Airbus executives warn that if any one capital can pull the handbrake for political reasons, future clients will opt for French or American hardware, where the licence procedures even if stringent at least arrive with a clear roadmap rather than a last‑minute cliff‑edge. Continuation: Türkiye hosts Incirlik Air Base, stores U.S. tactical nuclear bombs under NATO’s nuclear‑sharing scheme, and commands Black Sea maritime patrols that bottle up Russia’s navy. Losing Turkish access or even seeing Ankara drift toward Russian or Chinese jets would cripple alliance interoperability built over decades. Turkish officials have already floated limiting allied flight‑plans through their airspace. The mere threat underscores how fragile the post‑Cold‑War security bargain has become: democratic slippage in one ally triggers moral pushback in another, which in turn feeds Kremlin talking points about Western hypocrisy and “unreliable” partners. Türkiye's Plan B's Su‑35 / Su‑57  (Russia) Immediate availability; political signalling CAATSA sanctions; logistics dependency; further alienation from NATO JF‑17 Block III  (China‑Pakistan) Lower cost; AESA radar; co‑production options Limited range/payload; untested against near‑peer adversaries Life‑extension of F‑16 fleet Existing infrastructure; minimal diplomatic blow‑back Airframe fatigue; outpaced by Greek upgrades Accelerate KAAN Sovereign control; tech‑base development Engine dependence on Rolls‑Royce; high technical risk; earliest IOC ~2030s The EU’s 2008 Common Position already obliges members to deny arms licences when there is a “clear risk” of serious rights abuse. The real problem is consistency. France still sells Rafales to Egypt; Italy ships frigates to Qatar; Germany itself partially lifted its Saudi embargo last year. Selective morality breeds predictable backlash from capitals that feel singled out. If Europe wants credibility, it needs a transparent union‑wide  test, one that combines democratic metrics, sunset clauses, industrial offset funds, and a credible appeals process. Anything less and every one‑off veto becomes a case study in hypocrisy and an invitation for Moscow or Beijing to fill the vacuum. Tur­ko­no­mics.net Perspective We defend two principles: Democracy and rule of law are non‑negotiable.  Jailing political opponents corrodes Türkiye’s international standing and domestic social fabric alike. Strategic deterrence cannot be an afterthought.  Europe gains nothing by moral posturing that drives a key NATO member toward rival suppliers and then laments the loss of leverage. Reconciling those imperatives requires more than slogans. The Eurofighter debacle should push the EU to craft an arms‑export regime that punishes democratic backsliding while offering a pathway back, plus  tangible incentives to keep wavering allies anchored in Western supply chains. Otherwise this won’t be the last time values collide with security. Next time, the damage to the alliance could be irreversible.

This essay examines the theoretical background, practical application, and long-term viability of Universal Basic Income (UBI) through logical analysis and historical evidence. In an era marked by unprecedented technological progress, rising inequality, and the looming threat of AI-driven job displacement, UBI has entered the Overton window as a bold and unconventional policy proposal. It refers to a form of social security that provides regular and uniform cash payments to all citizens without means testing or work requirements. Proponents argue that it offers a revolutionary solution to the cycle of poverty and inequality by redistributing wealth and ensuring a minimum standard of living for all. However, critics question its economic feasibility, potential to disincentivize work, and suitability across diverse economic contexts. This analysis aims to determine whether UBI can serve as a practical and sustainable tool for fostering a balance between economic growth and equity in the modern world. The concept of Universal Basic Income has evolved over centuries, rooted in philosophical and economic debates surrounding social justice and economic security. Early iterations can be traced to the Enlightenment period, when thinkers such as Thomas Paine proposed a “citizen’s dividend” in his 1797 pamphlet Agrarian Justice , advocating for redistributive payments funded by landowners to compensate for unequal access to natural resources. In the 20th century, the idea gained traction among economists across the ideological spectrum. Free-market advocate Milton Friedman proposed a form of UBI through his Negative Income Tax (NIT) model in the 1960s, aimed at reducing poverty while preserving individual freedom and market efficiency. Simultaneously, progressive scholars and social democrats viewed UBI as a pathway to social equity and economic stability in increasingly automated economies. The resurgence of interest in UBI in the 21st century has been fuelled by the dual forces of technological disruption and growing inequality, prompting pilot programs and policy debates in both developed and developing nations. Its evolution reflects a longstanding effort to reconcile economic efficiency with moral responsibility, positioning UBI as both a radical and historically grounded response to modern inequality. A representation of wealth distribution among different income groups Inequality today is primarily driven by wealth concentration, where assets are held disproportionately by a small elite, leaving much of the population financially insecure. As of 2021, the top 10% of the UK population owned 57% of the total wealth, while the bottom 50% held less than 5% (JRF, 2023). As a result, a growing number of workers compete in a labour market where opportunities are increasingly shaped by an asset-rich minority. This imbalance suppresses wages, reduces purchasing power, and limits access to essential goods and services. Economic instability theories argue that extreme wealth inequality weakens consumer demand and hampers long-term growth (Piketty, 2014). In highly unequal economies, financial resources concentrate among the wealthy, who are more likely to save than spend (Dynan et al., 2004). UBI counters this by redistributing income toward lower-income individuals, increasing consumption and reducing the stagnation caused by inequality. Further exacerbating inequality is the dynamic where asset owners generate passive income through rent and investments, while ordinary workers transfer their earnings to landlords and creditors. This perpetuates a self-reinforcing cycle of wealth accumulation at the top, limiting social mobility. Moreover, regressive taxation policies place additional strain on lower-income households. For instance, in 2020–21, the poorest 10% of UK households paid 9.8% of their income in council tax, compared to just 1.5% for the richest 10% (Resolution Foundation, 2023). This disparity reduces disposable income and deepens financial hardship among vulnerable groups. These factors highlight the structural challenges embedded in the UK’s economic landscape, where wealth inequality is entrenched and inadvertently perpetuated by existing policy frameworks. An illustration of the effects of an increased Aggregate Demand UBI’s economic foundation is rooted in a post-Keynesian framework, which views the policy as a tool to counteract economic instability, unemployment, and inequality by stimulating demand and promoting financial security. Post-Keynesian economists emphasize the importance of aggregate demand in driving growth and maintaining economic stability. UBI acts as a direct fiscal stimulus by increasing disposable income, particularly for low-income individuals who have a high marginal propensity to consume. This boosts consumption, stabilizes real GDP growth, and reduces the risk of demand-side recessions, as explained by Keynesian multiplier effects (Bregman, 2017). Moreover, the Harrod-Domar growth model posits that economic growth is driven by savings and investment. By reducing financial strain, UBI enables low-income individuals to save more, increasing the pool of investable funds. If these are channelled into productive investments, growth accelerates, aligning with the model's predictions (Domar, 1946). Higher aggregate demand can also lower unemployment as firms respond to increased consumption by hiring more workers. More significantly, UBI’s monetary security allows individuals to exit exploitative or precarious jobs without the fear of losing income. This freedom encourages greater participation in education, training, and entrepreneurship, enhancing both the flexibility and resilience of the labour market. From a behavioural economics perspective, financial scarcity imposes a cognitive burden on the poor, limiting their ability to plan and make long-term decisions (Mullainathan & Shafir, 2013). This ‘scarcity mindset’ leads to short-term thinking, which entrenches poverty. By providing a stable and predictable income stream, UBI alleviates this burden, enabling recipients to invest in their future through education, skill development, and enterprise. Despite its benefits, UBI faces criticism regarding its potential side effects. Chief among them is the risk of inflation. If aggregate demand rises without a corresponding increase in productive capacity, inflation may result. From a Keynesian perspective, the inflationary impact of UBI depends on the output gap—the difference between actual and potential real GDP. If the economy has significant slack (e.g., high unemployment), firms can meet increased demand through higher production rather than price hikes. However, in economies operating near full capacity, increased spending could exceed output, leading to demand-pull inflation. This suggests UBI may be more effective in developing countries, where underutilized resources are more prevalent. UBI has shown promise in various pilot programs over the past decade. In Madhya Pradesh, India, unconditional monthly income grants led to significant improvements in debt reduction, education, and nutrition. With greater financial security, communities were able to negotiate better wages and working conditions. A separate study in Kenya found that lump-sum cash grants had a greater impact than monthly payments. Recipients who received lump sums started 19% more enterprises with 80% higher average revenues. This supports the theory that people in poverty are often constrained not by motivation, but by lack of capital. Some monthly payment recipients even formed rotating savings clubs to emulate the lump-sum model, reflecting resourcefulness and collective effort. These results underscore that poverty does not stem from a lack of vision, but from limited opportunities—a gap UBI can help bridge. By contrast, a 2020–2023 UBI trial in the U.S. involving 3,000 low-income families in Dallas and Chicago produced mixed results (Vivalt et al., 2024). Families receiving $1,000 monthly for three years earned $1,500 less on average than the control group and worked 1.3–1.4 fewer hours per week. The additional time was largely spent on leisure rather than education or entrepreneurship, contrasting with the Kenyan outcomes. Researchers found no significant improvements in job quality, and their confidence intervals ruled out even small effects. These findings suggest a moderate reduction in labour supply not offset by productivity gains, challenging the assumption that UBI boosts human capital in all contexts. Health outcomes were similarly underwhelming (Miller et al., 2024). Despite expectations that higher income improves well-being, researchers found no measurable changes in physical health or health-related behaviours. Minor mental health improvements observed in the first year had vanished by the second. These results indicate that unconditional cash transfers alone may be insufficient to address health inequalities, especially in developed countries with established health systems. Targeted interventions may be more effective in such settings. Surprisingly, the average net worth of UBI recipients was $1,000 lower despite receiving $36,000 tax-free (Bartik et al., 2024). Although perceived financial security improved and credit scores rose modestly, increases in debt offset asset growth. Estimated marginal propensities to consume were 0.44–0.55 for non-durables and 0.21–0.26 for durables, while debt repayment rates remained negligible. This suggests that while temporary UBI can boost consumption and reduce financial anxiety, it may not generate lasting improvements in wealth without complementary policies such as financial literacy training. That said, the findings from the U.S. study should be interpreted cautiously. The trial took place during the COVID-19 pandemic, which significantly distorted labour markets and consumer behaviour, potentially limiting the generalizability of the results. Beyond its immediate effects on poverty and inequality, UBI’s long-term sustainability depends on how it integrates with existing welfare systems. As automation threatens widespread job displacement, traditional welfare programs will become increasingly costly and complex. UBI, with its universal structure, offers a potentially more efficient alternative. In systems where up to 30% of welfare spending is lost to administrative costs (Moffitt, 2016), UBI’s simplicity and direct distribution reduce waste. These benefits are likely to become more pronounced as welfare needs expand in response to future economic disruptions.   Universal Basic Income presents a compelling but context-dependent solution to inequality in the 21st century. Empirical evidence suggests that while UBI can improve consumption and perceived financial well-being in the short term, it may fall short in promoting long-term health or wealth accumulation—particularly in developed economies. However, its demonstrated success in developing contexts, where capital constraints are more binding and welfare infrastructure is weaker, highlights its potential as a powerful anti-poverty tool. As inequality deepens and technological change accelerates, UBI offers a simplified and potentially more equitable alternative to complex welfare systems. Though not a panacea, it is a serious policy contender that deserves further exploration—especially when paired with complementary investments in education, healthcare, and financial capability. In a rapidly evolving global economy, UBI merits more than theoretical curiosity; it demands real political and economic consideration.     Footnote: 1.      Although the NIT shares ideological roots with UBI, it differs significantly in structure. The NIT provides cash (a negative tax) to individuals who earn little or no income. As recipients begin to earn more, the benefit gradually decreases, ensuring they are always better off working. This mechanism preserves the incentive to work and encourages long-term self-sufficiency.     References: Bartik, A.W., Rhodes, E., Broockman, D.E., Krause, P.K., Miller, S. and Vivalt, E., 2024.  The impact of unconditional cash transfers on consumption and household balance sheets: Experimental evidence from two US states  (No. w32784). National Bureau of Economic Research. Bregman, R., 2017. Utopia for Realists: And How We Can Get There.  Bloomsbury Publishing. Domar, E.D., 1946. Capital expansion, rate of growth, and employment. Econometrica, Journal of the Econometric Society , 14(2), pp.137-147. Dynan, K.E., Skinner, J. and Zeldes, S.P., 2004. Do the rich save more? Journal of Political Economy , 112(2), pp.397-444. Joseph Rowntree Foundation (2023) UK Poverty 2023: The essential guide to understanding poverty in the UK. Miller, S., Rhodes, E., Bartik, A.W., Broockman, D.E., Krause, P.K. and Vivalt, E., 2024.  Does income affect health? Evidence from a randomized controlled trial of a guaranteed income  (No. w32711). National Bureau of Economic Research. Moffitt, R.A. (ed.), 2016. Economics of Means-Tested Transfer Programs in the United States, Volume I. University of Chicago Press. Mullainathan, S. and Shafir, E., 2013. Scarcity: Why Having Too Little Means So Much.  Times Books. Paine, T., 2000.  Agrarian justice . Raleigh, NC, USA: Alex Catalogue. Petersen, H.G., 2003. Globalisation, capital flight and capital income taxation: A European perspective. Universität Potsdam, Faculty of Economic and Social Sciences, Discussion Papers . Piketty, T., 2014. Capital in the Twenty-First Century.  Trans. Arthur Goldhammer. Belknap Press of Harvard University Press. Resolution Foundation (2023) Reforming council tax to address inequality. Available at: https://www.resolutionfoundation.org (Accessed: 5 February 2025). Vivalt, E., Rhodes, E., Bartik, A. W., Broockman, D. E., & Miller, S. (2024).  The employment effects of a guaranteed income: Experimental evidence from two US states  (No. w32719). National Bureau of Economic Research.

Understanding the underlying mechanisms behind market fluctuations and imbalances is central to macroeconomic analysis. In this piece, we examine the Cobweb Theory, a model that explains cyclical fluctuations, particularly in agricultural sectors, and explore both its theoretical foundations and practical applications . 1. Fundamental Principles of the Cobweb Theory The Cobweb Theory emerges from the observation that producers base future production decisions on past market prices. This reliance creates a time lag between the decision to produce and the actual market supply, which, in turn, induces oscillations in price and quantity. The model rests on a couple of core assumptions: • Delayed Production: In industries like agriculture, production takes time. Farmers and producers make their decisions based on current or past prices, but the effects of those decisions appear only after a production lag. • Simple Price Forecasting: Producers are assumed to use historical prices to predict future prices, ignoring more complex information channels such as expert analyses, technological changes, or global news flows. These assumptions lead to a situation where the market’s supply and demand curves create a “cobweb” pattern, a back-and-forth movement that can either converge to equilibrium or diverge into instability over time. 2. Theory Meets Practice: The Olive Oil Example from the Mediterranean To better illustrate the theory, let’s consider a concrete example from the Mediterranean region, specifically, olive oil production in southern Turkey and other similar climates: • Market Dynamics: In some years, favorable weather coupled with increased global demand can cause a significant spike in olive oil prices. Observing these higher prices, producers are incentivized to either plant more olive trees or increase the yield from existing groves. • Response to Price Signals: However, olive trees require several years to reach full production. By the time the added supply reaches the market, an oversupply situation may have developed, leading to a sharp decline in prices. This drop forces producers to reduce production in the following cycle. • Oscillatory Equilibrium: As a consequence, the market alternates between periods of oversupply (leading to low prices) and undersupply (leading to high prices), perfectly embodying the cyclical nature predicted by the Cobweb Theory. 3. Theoretical Framework: Modeling Oscillations and Stability Within the framework of the Cobweb Model, three distinct market dynamics can be observed: • Convergent Model: Oscillations diminish over time, eventually leading the market toward a stable equilibrium. • Divergent Model: Each cycle amplifies the oscillations, pushing the market into increasingly unstable territory. • Persistent Cyclical Model: The market settles into a continuous, self-repeating cycle of ups and downs. The outcome depends on various factors, such as the accuracy of producers’ expectations and the inherent delays in production. While the classic Cobweb Theory simplifies the behavior of market participants, modern producers typically utilize a broader range of information, making these cyclical patterns less pronounced in today’s complex economic landscape. The Cobweb Theory offers valuable insights into price fluctuations and production cycles in sectors where output cannot be instantly adjusted, most notably in agriculture. It highlights how reliance on past data can create self-reinforcing cycles of boom and bust. While not a perfect mirror of reality, especially in the age of rapid information flow, thetheory remains a powerful tool for understanding the interplay between production lagsand market dynamics. By bridging theoretical analysis with a tangible example from the Mediterranean olive oilmarket, we see that economic patterns can often mirror natural cycles. This analysis not only deepens our understanding of economic behavior but also informs policy decisions in sectors where production timing is critical.

Argentina has been a case study of economic volatility for decades, defaulting on debt, suffering runaway inflation and battling poverty and currency instability. But 2025 could be a tipping point. The president, Javier Milei, has embarked on one of the most extreme economic rewrites in the country’s recent history since taking office. His reforms are ambitious, divisive and, scholarly opinion suggests, possibly transformative. So what in the world is going on in Argentina? And can these reforms really rehabilitate an economy long racked by crisis? Who Is Javier Milei? Javier Milei, an economist and former TV personality, was elected president in 2023 on a libertarian, anti-establishment platform. Branding himself as a crusader against what he calls the "political caste," Milei promised to dismantle Argentina's bloated state apparatus and liberate the private sector. His most famous soundbite? “¡Viva la libertad, carajo!” (“Long live liberty, damn it!”) Key Economic Reforms Currency Deregulation: Ending Exchange Rate Distortion For years, Argentina has had a dysfunctional currency system, with a wide gap between official and black-market exchange rates. Milei’s government eliminated many of the capital controls that had restricted access to foreign currency, allowing the peso to have a freer float. Although the first stop of the deregulation led to a sudden plunge of the peso, confidence in the peso started to return. By early 2025, the currency appreciated more than 44% against the U.S. dollar. This reduced the spread between the legal and illegal exchange markets, increased the profit margins for exporters, and contributed to the restoration of the foreign reserves. The reforms made Argentina more appealing to foreign investors by enhancing transparency and aligning the peso with actual market realities. But there remains a fine line to walk, an over-strong peso can erode export competitiveness without enhancements in productivity. Austerity Measures: A Hard Reset Javier Milei did the most immediate thing when he took office: Apply militant austerity measures that are a complete overthrow of decades in which public spending was high. His administration cut energy and transport subsidies, leading prices for utilities to surge, but easing pressure on government finances. Public sector hires were frozen, many state agencies were restructured or downsized, seeking to reduce what Milei describes as a “bloated and inefficient bureaucracy.” The actions provoked public anger and caused short-term economic hardship, including higher unemployment and a brief decline in consumption. But the reforms are also part of a solution to Argentina’s chronic deficit, and they were an important part of restoring credibility with international institutions like the I.M.F. For Milei, austerity was not only a matter of budget cuts, but also a philosophical reset, turning the economy away from dependence on the state and toward growth led by the private sector. Combating Inflation But perhaps the most striking change under Milei has been the dramatic fall in inflation. Argentina had been struggling with triple-digit inflation for years; inflation rates surged past 300% in 2024. By combining tight monetary policy and fiscal discipline with an end to the central bank’s printing of money to fund government deficits, inflation started to come down. Annual inflation plummeted to 117.8% by November 2024, and by January 2025, monthly inflation reached 2.2% an all-time low in three years. Both have reestablished purchasing power as well as restoring public confidence in the national currency. Though these gains are tenuous, and some economists fear stagnation if the process of disinflation proceeds too rapidly, Milei’s methods have brought the country closer to macroeconomic stability than it has been in decades. Reviving Agriculture One of the most immediate successes of Milei’s reforms has come in the agricultural sector, historically the backbone of Argentina’s economy. By scrapping onerous punitive export taxes and rolling back regulation that hampered international sales, the government set off a wave of productivity. In the final quarter of 2024, agricultural production rebounded more than 80 per cent, propelling national GDP growth of 3.9 per cent. Withdrawn from uncompetitive official pricing, exporters returned to global markets with renewed confidence. That resurgence didn’t only benefit agribusiness elites, it produced a ripple effect for employment, wages and regional investment in rural America. With demand for food and raw materials climbing worldwide, Milei sees agriculture as a key element in a multiyear recovery. But maintaining that momentum will take investment in infrastructure, water management and climate resilience to withstand future shocks. Short-Term Pain, Long-Term Gain? President Milei’s economic transformation has paid immediate and accurate dividends in stabilizing the macroeconomy with a decline in inflation, an appreciating peso, and a recovery in pivotal sectors such as agriculture. But for millions of Argentinians, this data hasn’t yet turned into immediate relief. Instead, reform’s first years have been marked by soaring living expenses, rampant job loss and a shrinking public safety net. Scrapping energy and transport subsidies, although lightening the load on the national budget, has hit lower- and middle-income households hardest. Increasingly, families are spending a much larger share of their monthly income on electricity, gas and public transport. And the freeze and layoffs in the public sector have seen sharp increases in short-term unemployment, particularly in provincial cities where government jobs are a key source of income. For the first time, poverty jumped to 57% in early 2024, sparking mass protests and labour strikes. But in the third quarter, data showed it down to 38.1% as inflation eased and real wages, especially in the private sector, started to recover. This implies that a number of the harshest consequences would have been transitional, as the labor market gradually adapted to the new economic model. Social tensions remain high. A lot of Argentinians are skeptical about the “shock therapy” method, believing that they are paying for the cure while enjoying none of the benefits that are still theoretical or way in the future. The government, for its part, contends that this pain is temporary and essential to liberating the country from the cycle of inflation, currency collapse and international isolation. Milei’s own words are: “It is unavoidable to suffer today to grow tomorrow.” On the flip side, investor confidence is for sure on the mend. Argentina’s risk premium has reduced; foreign capital is tentatively coming back and domestic entrepreneurs especially in agribusiness, fintech and energy are starting to reinvest. This creates a paradox: the nation is enticing to capital but extremely polarized at home. Whether Argentina’s short-term suffering becomes long-term gain depends on two key factors. First, the government’s ability to maintain social cohesion and keep unrest from derailing reforms. And second, its ability to translate structural efficiency gains into inclusive growth in the form of job creation, innovation and development of infrastructure. Argentina is in many ways balancing on a tightrope. The macroeconomic data may be headed in the right direction, but to be truly bold, Milei’s reforms must be deemed not just ambitious, but fair, too and the lived experiences of ordinary people have to get on track, as well. What Lies Ahead? Projections for 2025 suggest economic growth of 3.5%–5.5%, driven by renewed investor interest, macroeconomic stability, and increased exports. Inflation, while still high, is expected to continue falling throughout the year. But the real test lies in whether Milei can maintain political stability. His reforms are divisive, and opposition within Congress remains strong. Large-scale protests have already emerged, and social tensions could threaten implementation if not managed carefully.