Is Erdo?an's 'taka' headed for the cliffs?

Not according to credit ratings agency Standard & Poor?s. In a note released on Feb. 6, S&P said the ?banking regulator?s (BDDK) decision to transfer the management of Bank Asya to the Savings Deposit Insurance Fund (TMSF) does not affect the unsolicited credit ratings on Turkey.?

At first look, this makes sense. After all, S&P notes that ?Bank Asya?s relatively small size (roughly 0.1 percent of banking sector assets) makes it rather unlikely that there could be any contagion effects.? Despite some recent increase in non-performing loans, the rest of the banking sector is in good health.

But I would argue that such an approach is missing the forest for the trees. To explain myself, let me pose a simple question: Why was Turkey hit with the 2001 crisis? You may tell me it was because of the banking sector. Or that it was a political matter, triggered by the row between the president and the prime minister of the time.

Both explanations are incomplete. I would argue that at the heart of it, the crisis was a consequence of politicians meddling with the economy and markets. Kemal Dervi?, the World Bank executive brought in to save the economy, knew this well. That?s why he made the independence of the Central Bank and regulatory institutions one of the key pillars of his economic recovery program.

Although he reaped the benefits with economic stability and increased voter support early on, President Recep Tayyip Erdo?an has nevertheless been trying to get rid of these independent institutions for a while. He has been largely successful, replacing civil servants with subjects, with the exception of the Central Bank ? he recently bemoaned the Bank?s independence.

As for the Bank Asya takeover, while government...