Last Call For Nobody's Business But The Turks, Con't

Turkey has once again elected Tayyip Erdogan as president, as his relentless two-decade rule continues.

President Tayyip Erdogan extended his two decades in power in elections on Sunday, winning a mandate to pursue increasingly authoritarian policies which have polarised Turkey and strengthened its position as a regional military power.

His challenger, Kemal Kilicdaroglu, called it "the most unfair election in years" but did not dispute the outcome.

Official results showed Kilicdaroglu won 47.9% of the votes to Erdogan's 52.1%, pointing to a deeply divided nation.

The election had been seen as one of the most consequential yet for Turkey, with the opposition believing it had a strong chance of unseating Erdogan and reversing his policies after his popularity was hit by a cost-of-living crisis.

Instead, victory reinforced his image of invincibility, after he had already redrawn domestic, economic, security and foreign policy in the NATO member country of 85 million people.

The prospect of five more years of his rule was a major blow to opponents who accused him of undermining democracy as he amassed ever more power - a charge he denies.

In a victory speech in Ankara, Erdogan pledged to leave all disputes behind and unite behind national values and dreams but then switched gears, lashing out at the opposition and accusing Kilicdaroglu of siding with terrorists without providing evidence.

He said releasing former pro-Kurdish party leader Selahattin Demirtas, whom he branded a "terrorist," would not be possible under his governance.

Erdogan said inflation was Turkey's most urgent issue.

Kilicdaroglu's defeat will likely be mourned by Turkey's NATO allies which have been alarmed by Erdogan's ties to Russian President Vladimir Putin, who congratulated his "dear friend" on his victory.

 

At this point, Turkey walking away from NATO, Ukraine, and the EU seems more likely than not. Putin has been wanting to peel off Ankara from NATO for a while now, and with Erdogan having secured power for a fifth term, that's the immediate issue.

Turkey is the second-largest NATO military, behind the US. If they decide to pull the plug on arming Ukraine, it's going to be a bloody summer.

Meanwhile, domestically, Erdogan won based on promises to fix inflation. The world markets don't believe him for a moment.

The Turkish lira sank to a fresh record low Monday as incumbent Recep Tayyip Erdogan secured his victory in the 2023 presidential election, extending his rule into a third decade in power.

The currency briefly touched 20.0608 against the greenback at around 11 a.m. Monday morning local time, surpassing a low seen last week. It was at 20.0913 against the dollar near 12:45 London time.

“We have a pretty pessimistic outlook on the Turkish Lira as a result of Erdogan retaining office after the election,” Wells Fargo’s Emerging Markets Economist and FX Strategist Brendan McKenna told CNBC.

McKenna forecasts that the lira will reach a new record low of 23 against the dollar by end of the second quarter, and then 25 as early as next year. It has lost some 77% of its value against the dollar over the last five years. He expects Turkey’s unorthodox monetary and economic policy frameworks to remain in place going forward.

Turkey’s monetary policy places an emphasis on the pursuit of growth and export competition rather than taming inflation, and Erdogan endorses the unconventional view that raising interest rates increases inflation.

“The current set up is just not sustainable,” said BlueBay Asset Management’s Senior EM Sovereign Strategist Timothy Ash via email.

“With limited FX reserves and massively negative real interest rates the pressure on the lira is heavy,” Ash continued.

Istanbul’s main index, the Turkey ISE National 100 gained roughly 4.31%.

Credit default swaps, which measure the cost of insuring exposure to Turkish debt, also spiked.

Five-year CDS were trading at around 664.18 basis points, marking a 20% climb from the 550 basis point level prior to the run-offs, according to Refinitiv data.

These developments reflect market participants’ belief that orthodox policies, which were promised by the political opposition, were the only way to get the Turkish economy out of a potential crisis, said Selva Demiralp, a professor of economics at Koç University.

Meanwhile, MarketVector’s CEO Steven Schoenfeld wrote in an e-mail. “If the Lira continues to plunge and inflation surges again due to the policy of inappropriately-low interest rates, we could see a repeat of the ‘flight to safety’ allocation to Turkish equities by local investors which moved the market sharply higher in 2022.”

 

So nobody's happy in Turkey right now except, of course, for Erdogan.

The Manchin On The Hill, Con't

Democratic Sen. Joe Manchin of West Virginia will get his pipeline through the state after all, stuffed into the debt ceiling deal so that he doesn't scuttle it.

 

The text of the debt ceiling bill released on Sunday would approve all the remaining permits to complete the stalled Mountain Valley Pipeline, delivering a big win for West Virginia Sens. Joe Manchin and Shelley Moore Capito.

But the backing of the pipeline that would deliver gas from West Virginia into the Southeast is sure to set off bitter complaints from the environmental groups that have fought its construction for years and turned the project into a symbol of their struggle against fossil fuels.

Manchin hailed the bill’s language, saying finishing the pipeline would lower energy costs for the United States and West Virginia.

“I am proud to have fought for this critical project and to have secured the bipartisan support necessary to get it across the finish line,” he said in a statement.

The bill agreed by the White House and House Republicans must still be approved by both chambers of Congress, which is expected to happen in the coming week.

 

This of course will bring Manchin plenty of money after he leaves the Senate. As for the people of WV who will lose their lands and environment in the Wild and Wonderful state, well...you made Manchin a lot of money, so shut up.

Still, he may not actually get what he wants in the end.

 

Sen. Tim Kaine (D-Va.) will take steps to strip a new natural gas pipeline project from a bipartisan bill to raise the debt ceiling, his office said Monday—one of several scenarios that could derail the newly announced legislation as party leaders scramble to secure votes to pass it before the country defaults on its debt as soon as June 5.

Kaine’s office said Monday he would file an amendment to remove federal permits for the Mountain Valley Pipeline project from the debt ceiling bill, calling the provision “completely unrelated to the debt ceiling matter,” NBC News reported Monday.

Kaine has long opposed the project backed by Sen. Joe Manchin (D-W.Va.), which would transport gas to East Coast markets via a 300-mile pipeline through West Virginia and Virginia and has faced repeated delays prompted by legal challenges from environmentalists.

Kaine’s push for an amendment is one of several hurdles that could complicate, delay or even change the math for the bill in the Democratic-controlled Senate—where it needs 60 votes to clear a filibuster threshold—before it heads to President Joe Biden’s desk for final approval.

GOP Sens. Mike Lee (Utah) and Lindsey Graham (S.C.) have also vowed to take measures that could stall the legislation in the upper chamber, with Lee taking issue with what he said is an inadequate reduction in overall federal spending and Graham raising concerns about a provision that caps defense spending at the $886 billion Biden requested in his fiscal year 2024 budget.

The Republican-controlled House Rules Committee is expected to vote as soon as Tuesday on the guidelines for debate, including whether the bill will be subject to amendments, but three of the nine Republican members have publicly criticized the bill, meaning their votes against the legislation could stall it in committee if the four Democrats on the panel also oppose. 

So the whole thing could still come undone.

Vote Like Your Country Depends On It, Con't

Texas Republicans have removed election functions from Harris County, home of Houston and 4.8 million Texans, and granted those powers to Secretary of State Jane Nelson, setting the county and one-sixth of the state's citizens to be disenfranchised in future elections.

Texas Republicans wound down their regular legislative session Sunday by changing election policies for a single populous Democratic stronghold but not other parts of the state.

The measure gives the secretary of state under certain conditions the power to run elections in Harris County, home to Houston and 4.8 million residents. It follows a bill approved days earlier that shifts the oversight of elections from its appointed elections administrator to the county clerk and county assessor.

Harris County officials at a news conference last week said they would bring a lawsuit challenging the measures as soon as Gov. Greg Abbott (R) signs them into law.

“These bills are not about election reform,” said Harris County Judge Lina Hidalgo, the county’s chief executive. “They’re not about improving voters’ experience. They are entirely about suppressing voters’ voices. The reasoning behind these bills is nothing but a cynical charade.”

Also over recent days, the Republican-controlled legislature passed bills increasing penalties for illegal voting and likely setting the stage for the state to withdraw from the Electronic Registration Information Center. The center was formed in 2012 to help states maintain accurate voter rolls, identify instances of potential fraud and contact people so they can register to vote. More than half the states belong to the consortium, but some Republican-run states have bolted from it over the last year as election deniers have spread false information about its work.

Critics are concerned about how the two bills affecting Harris County will interact with one another. One bill requires the county to change who oversees its elections starting Sept. 1, just weeks before Houston holds its election for mayor.

The quick transition could easily lead to problems, opponents of the measure say. If problems do occur, Secretary of State Jane Nelson could use the provisions of the other newly passed bill to oversee elections in Harris County. That would mean Nelson, a former state senator appointed as secretary of state by Abbott, would be in charge of the 2024 presidential election for the county.

And if Nelson did not believe that the new officials in charge of elections — Harris County Clerk Teneshia Hudspeth and County Assessor Ann Harris Bennett — had rectified problems, she could initiate legal proceedings to remove them from office under the legislation. Local officials said it would be unjust to allow the secretary of state the power to take action against two Black women but not those who hold equivalent positions in the state’s 253 other counties.

Under the bill, Nelson could oversee elections in Harris County if she found “good cause to believe that a recurring pattern of problems with election administration or voter registration exists in the county.” She would get to sign off on all of the county’s election procedures and could install members of her staff in Harris County offices.

 

The bill is of course designed to make Harris County elections fail so that Republicans can simply remove county elected officials (who just happen to be Democrats) and to replace them with Republican state officials. Of course, this only applies to Texas's most populous county, setting up a situation where the Secretary of State can annul and overturn any elections in the county because of "irregularities" and disenfranchise hundreds of thousands of voters without anything more than a whim. 

Near-permanent one-party rule is the goal, where any Democrats elected in Harris County would have their elections thrown out. It's what fascist states like Texas do.