How fragile we are

How fragile we are

I’ve had a song by Sting stuck in my head for the past two days. Remember the one that goes, “Nothing comes from violence and nothing ever could/For all those born under an angry star/Lest forget how fragile we are.”

Turkey is going through humbling days. Two big things have been happening: Turkey lowered its growth prospects for 2014 toward 3 percent, and at least 35 people have died in riots related to the war in Syria. Both are due to events outside Turkey’s borders, yet both brought to light Turkey’s domestic fragilities. These events should be deeply humbling for Turks. There you think you’ve planned ahead, that you’re in control, when a shockwave comes along and shatters your plans. Let me explain.

First of all, the American decision to start tapering is not good for Turkey. With the Fed ending its bond-buying scheme, interest rates will increase in Turkey, which is going to put the brakes on the growth that has already been slowing down since 2012. Turkish growth is coming down from a high point of 10 percent to the now expected 3 percent, while the current account deficit is coming down to around 6 percent from 10 percent. Low growth and high imbalance is a bad recipe in this journey through uncharted waters, if you ask me. And though the impact comes from outside, the problem lies in the fragility of Turkey’s economy.

Second, the situation in Syria is not good for Turkey. Note that the war in Syria is not of Turkey’s making, yet we feel its impact. That stands in contrast to the Americans who invaded Iraq, yet did not feel that war’s direct impact at home. Why? First, and most obviously, Iraq lies far away from the New World, and American Iraqis make up only a tiny fraction of Americans. Second, Iraqis and Americans do not share a sectarian or ethnic heritage. Neither one of those points is valid for Turkey. We have a shared sectarian and ethnic makeup with both, the Iraqis and Syrians. Anything that happens to a child on one side of our shared border will be felt by the likely family he has on the other side. And so, the violence spills over. That is a bad basis for any kind of further Turkish involvement, especially now that the country is hosting around 1.5 million refugees.

Third, lower growth will constrain Turkey’s political choices. With an uphill battle for the economy, Turkey will no longer be able to absorb Syria’s spillovers, be they refugees or missiles.  
It’s like the Sting lyrics, “All in all, how fragile we are.”