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Business News/ Opinion / Columns/  Voters pushing for change don’t always get enough of it

Voters pushing for change don’t always get enough of it

Elections in Turkey, Thailand and Karnataka have revealed stirrings that may not have much impact


Imagine a country where the incumbent president faces elections with inflation running at 44%, a rate that is half of the previous year’s peak, and whose currency is down by about 80% since the president was last elected. Instead of reform, he offers more of the same, i.e. cutting interest rates in the belief that this somehow reduce inflation. And in full-throttle populist mode, he raises civil servants’ salaries and lets people draw down pensions early. The incumbent is Turkey’s Recep Tayyip Erdoğan, who, after two decades in power, is almost certain to win another five year-term in a run-off election on Sunday against the candidate of the six-party opposition bloc, Kemal Kilicdaroglu.

The weekend of 13-14 May had three large elections that either took place then or had results declared: in Turkey, Thailand and India’s Karnataka. In Turkey, turnout approached 90%, while in Thailand and Karnataka about three-quarters of those eligible voted. The depressing corollary was that, with tall tales circulated on social media and government controls on conventional media, the narratives of incumbents mostly held. Erdoğan’s 49% vote, almost enough to prevent a runoff, put him almost 5 points ahead of his closest challenger. In Karnataka, despite a dismal record, the Bharatiya Janata Party secured roughly the same vote share it did last time. As far as incumbency goes, at least Thailand’s military-backed regime, beneficiaries of an army coup in 2014, did miserably. The young especially were enthused by the progressive Move Forward Party, but a military nominee-dominated upper house may yet find a way to frustrate the popular will for change.

Erdoğan’s extraordinary ability to turn what might otherwise have been a debacle into a likely victory is a remarkable win for the illiberal strongman-brand of autocratic democracy that has taken root in so much of the world, including by taking the US Republican Party hostage. Even the earthquake in Turkey appears to have played to Erdoğan’s advantage; many voters perhaps saw the ruling party as a better bet for reconstruction.

But Erdoğan has an unrivalled record of economic unorthodoxy that doesn’t work. India’s baffling demonetization in 2016 seems tame by comparison. The Turkish monetary-policy response to inflation, led by his ideas, has been to double down on interest-rate cuts to ‘control’ rising prices. He even appointed his 40-something son-in-law as finance minister in 2018, who quit a couple of years later as the Turkish lira continued to fall.

To cushion parts of the population from soaring prices, Erdoğan this year committed to raising the pay of civil servants and increasing Turkey’s pension bill. To shore up the lira, the central bank has used its reserves and received help from Qatar, Saudi Arabia and Russia, which delayed repayments for its large natural gas exports to Turkey. Voters in Ankara and Istanbul have elected mayors who are Erdoğan opponents seeking his ouster from power, but rural voters and large majorities of the diaspora in Germany, Netherlands and Austria (who cast postal ballots) were solidly behind Erdoğan and his strongman populism.

The most heartening story of change came from Thailand on 14 May, an election that paradoxically generated the least headlines. Move Forward Party, led by a 42-year-old with degrees from Harvard and MIT, got the most seats. marking the first time Thaksin Shinawatra’s Pheu Thai hadn’t won an election in about two decades. Move Forward’s agenda runs from reforming Thailand’s extreme lese-majeste laws to breaking up monopolies and oligopolies, and an end to military conscription as well as allowing same-sex marriages. In a bid to prevent the eight-party alliance Move Forward leads from splintering, on Monday it announced it would not dilute laws that police supposedly offensive comments about the Thai monarchy. This may not be enough to allay fears within Thailand’s conservative establishment. Already, a member of the incumbent military alliance has moved the anti-corruption commission to complain that Pita Limjaroenrat, the charismatic leader of Move Forward, did not declare that he owned shares of a media company in Thailand. The value of his holding is all of $6,000. Should the courts, widely seen as pro-military, rule in favour of the complainant and seek to disqualify Pita, Bangkok is likely to see large protests. The most optimistic election result of this season could thus end with very little change.

Which brings us to Karnataka, whose new Congress administration admirably wasted no time in telling the state’s police officers that they must treat all religious communities impartially. The new state government, however, is digging a hole with the competitive fiscal populism needed to combat religious polarization. And it inherits a city whose streets look as if they were hit by an earthquake. On Sunday, a 23-year-old working for Infosys drowned in a car she had hired for her family to sight-see after an underpass got flooded in central Bengaluru. This is the capital of Digital India and our exploitative gig economy, and also the shaky foundation for the distracting narrative that we can leapfrog the need for brick-and-mortar factories and well-made infrastructure with e-commerce and services. That is just as fanciful as Erdoğan’s notion that inflation can be controlled by cutting interest rates.

Rahul Jacob is a Mint columnist and a former Financial Times foreign correspondent.

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Published: 24 May 2023, 11:37 PM IST
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