Commentary Magazine


Topic: Recep Tayip Erdogan

Turkey Shows the Risk of Politicized Tax Collectors

There is little question now that at least some Internal Revenue Service (IRS) employees abused their position to allow partisanship to determine their actions. Who authorized such behavior, if anyone, remains subject to fierce partisan dispute. If the IRS targeted conservatives on the basis of their political belief and on the orders of anyone in the White House, most Americans would find such facts scandalous, and rightly so.

Many supporters of the Obama administration have pooh-poohed the scandal, or suggested that it comes from the fevered imaginations of Republican activists. They should not. Too many many fierce partisans will play hardball or engage in dirty tricks, all the more so if a precedent exists that leads them to believe they can get away with it.

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There is little question now that at least some Internal Revenue Service (IRS) employees abused their position to allow partisanship to determine their actions. Who authorized such behavior, if anyone, remains subject to fierce partisan dispute. If the IRS targeted conservatives on the basis of their political belief and on the orders of anyone in the White House, most Americans would find such facts scandalous, and rightly so.

Many supporters of the Obama administration have pooh-poohed the scandal, or suggested that it comes from the fevered imaginations of Republican activists. They should not. Too many many fierce partisans will play hardball or engage in dirty tricks, all the more so if a precedent exists that leads them to believe they can get away with it.

Here, Turkey illustrates just what can happen when politicized tax collection is allowed to continue unabated. Turkey today has threatened to go after Twitter on tax evasion charges. According to an Agence France Presse report:

“Twitter, YouTube and Facebook are international companies established for profit and making money,” Erdogan said. “Twitter is at the same time a tax evader. We will go after it,” he added. “These companies, like every international company, will abide by my country’s constitution, laws and tax rules”

In Turkey, the issue is not rule of law, for Prime Minister Recep Tayyip Erdoğan interprets the law through the narrow prism of his personal interest. Simply put, his philosophy is the 21st century equivalent of “L’État, c’est moi.” Erdoğan has a long history of using arbitrary tax enforcement to target opponents.  He leveled a multimillion-dollar tax fine against the owner of a newspaper critical of his abuse-of-power and, then, when that media group actually found the funds to pay up, he leveled a multi-billion dollar fine. The world saw the tax lien for what it was, and roundly condemned Erdoğan for using the tax man to crush opponents. It was a tried and true strategy. With one of his political allies facing tough competition in Istanbul, Erdoğan used the tax man to levy a fine against the chief secular competitor in the race for an allegedly unpaid loan, draining his campaign chest.  Turkey has effectively become a third world dictatorship, and its tax service more a mechanism to punish than simply raise revenue.

When tax collectors lose their credibility and become little more than political weapons, there is no restoring that credibility. How sad it is that so many supporters of President Obama for partisan reasons appear to turn a blind eye to the apparent attempt by some in the IRS to wield their power like a weapon. For Turkey shows what happens when such behavior is not nipped in the bud. Let us hope that Erdoğan’s embrace of executive order and financial punishment has not become a model which Obama knowingly or unconsciously follows.

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Will Turkey Join Iran and North Korea on the Terror Finance List?

Jonathan Schanzer, vice president for research at the Foundation for Defense of Democracy and an expert on the confluence of money laundering and terrorism, drew my attention to an important story getting lost in the shuffle of confirmation hearing and more violent stories from the Middle East:

The Turkish parliament is scrambling to avert action by the Financial Action Task Force (FATF), an international body meant to combat money laundering and terror financing, which would place Turkey on its blacklist if it does not adopt legislation preventing terror finance within a month.

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Jonathan Schanzer, vice president for research at the Foundation for Defense of Democracy and an expert on the confluence of money laundering and terrorism, drew my attention to an important story getting lost in the shuffle of confirmation hearing and more violent stories from the Middle East:

The Turkish parliament is scrambling to avert action by the Financial Action Task Force (FATF), an international body meant to combat money laundering and terror financing, which would place Turkey on its blacklist if it does not adopt legislation preventing terror finance within a month.

Hürriyet Daily News quotes Justice Minister Sadullah Ergin:

There are two countries on the black list of the FATF: Iran and North Korea. If Turkey fails to adopt the legislation by Feb. 22, the Turkish economy may face serious problems. In such a case money transfers from and to Turkey would be possible only after checks by the FATF’s examination mechanism. This mechanism would cause serious problems for Turkey’s exports, imports and hot money flow, which could lead to negative impacts on general parameters of our economy.

The only thing sadder than the fact that Turkey, which claims to be an ally, must be dragged kicking and screaming to stop financing terror is the fact that 150 congressmen have endorsed a country that may soon join the Islamic Republic of Iran and North Korea on the terror financing blacklist. When President Obama described Turkey’s leader Recep Tayyip Erdoǧan as a personal friend, it is time to ask whether Obama truly understands the differences between ally and adversary.

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