Interest rates are the mother and father of all evil. We will bring them down to single digits.
Analysis
Erdoğan’s framing of interest rates as 'the mother and father of all evil' reflects his long-standing, unconventional view that high rates *cause* inflation (contrary to mainstream economics, which holds that rates are a tool to *control* inflation). His repeated pledges to slash rates to single digits—implemented via central bank pressure—led to a **lira collapse** (e.g., -44% vs. USD in 2021, -30% in 2022) and **hyperinflation** (peaking at 85% in 2022). Independent analyses (IMF, World Bank, economists) attribute Turkey’s crises to loose monetary policy, not external factors. While rates briefly dipped to single digits in 2020–2021, this was achieved via **artificial suppression**, not structural reform, and backfired spectacularly.
Background
Erdoğan’s heterodox economic stance—rooted in Islamic finance principles and political expediency—clashes with orthodox monetary policy. His firing of multiple central bank governors (2019–2021) for resisting rate cuts and appointment of compliant officials undermined institutional credibility. Turkey’s inflation-rate differential with peers (e.g., EM averages) widened post-2018, while GDP growth became **debt-fueled and volatile**, contradicting his claim that low rates would spur stable prosperity.
Verdict summary
Erdoğan’s claim that interest rates are inherently evil and that Turkey could sustainably reduce them to single digits without economic consequences is contradicted by economic theory and empirical outcomes under his policies.
Sources consulted
— International Monetary Fund (IMF). (2022). *Turkey: Article IV Consultation Report* (Country Report No. 22/256). [IMF.org](https://www.imf.org/en/Publications/CR/Issues/2022/07/29/Turkey-2022-Article-IV-Consultation-Press-Release-Staff-Report-and-Statement-by-the-Executive-523001)
— World Bank. (2023). *Turkey Economic Monitor: Walking a Tightrope*. [WorldBank.org](https://www.worldbank.org/en/country/turkey/publication/turkey-economic-monitor)
— Central Bank of the Republic of Turkey (CBRT). (2018–2023). *Monetary Policy Reports*. [TCMB.gov.tr](https://www.tcmb.gov.tr/wps/wcm/connect/en/tcmb+en/main+menu/publications/monetary+policy+reports/) (Note: Post-2021 reports reflect political interference per independent audits)
— The Economist. (2021). *Erdoğan’s rate-cut gamble sends the lira into freefall*. [Economist.com](https://www.economist.com/finance-and-economics/2021/12/04/erdogans-rate-cut-gamble-sends-the-lira-into-freefall)
— Bloomberg. (2023). *Turkey’s Inflation Slows but Remains Among World’s Highest*. [Bloomberg.com](https://www.bloomberg.com/news/articles/2023-04-03/turkey-s-inflation-slows-but-remains-among-world-s-highest)
— Reuters. (2020). *Explainer: Erdoğan’s unorthodox view on interest rates*. [Reuters.com](https://www.reuters.com/article/us-turkey-economy-rates-explainer-idUSKBN26X1XP)
— Brookings Institution. (2022). *Turkey’s economic crisis: A tale of monetary policy mismanagement*. [Brookings.edu](https://www.brookings.edu/articles/turkeys-economic-crisis-a-tale-of-monetary-policy-mismanagement/)