The political economy of state - building: The case of Turkish Cypriots (1960-1967)

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THE

POLITICAL ECONOMY OF STATE–BUILDING:

THE

CASE OF TURKISH CYPRIOTS

(1960–1967)

A THESIS SUBMITTED TO

THE GRADUATE SCHOOL OF SOCIAL SCIENCES

OF

İSTANBUL BİLGİ UNIVERSITY

BY

HAKAN ARSLAN

IN PARTIAL FULLFILMENT OF

THE REQUIREMENTS FOR

THE DEGREE OF DOCTOR OF PHILOSOPHY

IN

THE DEPARTMENT OF POLITICAL SCIENCE

February, 2014

İSTANBUL

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İSTANBUL BİLGİ UNIVERSITY

FACULTY OF

ECONOMICS AND ADMINISTRATIVE SCIENCES

THE

POLITICAL ECONOMY OF STATE–BUILDING:

THE

CASE OF TURKISH CYPRIOTS

(1960–1967)

HAKAN ARSLAN

February, 2014

İSTANBUL

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ABSTRACT

THE POLITICAL ECONOMY OF STATE-BUILDING: THE CASE OF TURKISH CYPRIOTS

(1960–1967)

Supervision: Prof. Dr. Ertuğrul Ahmet Tonak FEBRUARY, 2014

713 pages, 213280 (net) words

This thesis is a theoretical narrative of the Turkish Cypriot (T//C) politics and economy, for the period of 1960–1967, from the point of view of Marxist theories of the state, and political economy. It rests upon two key observations as regards to the state of studies on the T/Cs, firstly, the oversight of domestic dynamics, and particularly, of the economy and politics, and secondly, the oversight of theory and methodology. In so doing, it makes use of, and critically rethinks aspects of Bob Jessop’s theory of the capitalist state and economy, and the early Erik Olin Wright’s theory of causality, supplementing the two by Anwar Shaikh–Ertuğrul Ahmet Tonak’s elaboration of the theory of productive and unproductive labour. Overall, the thesis distinguishes itself from the existing literature by its focus upon economy and politics, rather than identity; its attempt to model the relations between domestic dynamics, and inter-state politics and global political economy, and; its regard of the period of 1960–1967 as the critical episode to which the origins of the power relations and generalised crisis characterising today’s T/C society must be traced back. Methodologically, it proceeds by way of developing an historically and empirically grounded conceptual framework applied to the sub-periods of 1960–1963 (the common state of the Republic of Cyprus), and 1964–1967 (the first phase of enclave life). The key insight of the thesis is that there was a contradiction between the two sub-processes of the T/C nationalist project of Taksim, namely state-building and capital accumulation, which, amongst other things, sheds light onto the origins and causes of the patronage-based post-1974 state power and its current crisis. Theoretically, the T/C case supports key aspects of Jessop’s theory of the state (most particularly, relationality and strategicness), and Wright’s theory of causality (most particularly, structural limitation).

Key Words: Turkish Cypriot Politics, Taksim, Turkish Cypriot Economy,

State Theory, Political Economy, State-building, Causality, Determination, Unproductive Labour

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ÖZ

DEVLET İNŞASININ EKONOMİ POLİTİĞİ: KIBRIS TÜRKLERİ ÖRNEĞİ

(1960–1967)

Danışman: Prof. Dr. Ertuğrul Ahmet Tonak Şubat 2014

713 sayfa, 213280 (net) sözcük

Bu tez, 1960–1967 Kıbrıs Türk siyaseti ve ekonomisi üzerine, Marksist devlet teorileri ve ekonomi politik perspektiflerine dayalı bir teorik anlatıdır. Kalkış noktası, Kıbrıs Türklerine ilişkin çalışmalardaki duruma yönelik eleştirel iki gözlemdir. Bunlardan ilki iç dinamiklerin (ve özellikle ekonomiyle siyasetin), ikincisi ise, teori ve metodolojinin göz ardı ediliyor olduğudur. Tez, bu eksiklikleri ele almaya dönük bir çaba olarak, bir taraftan Bob Jessop’ın kapitalist devlet ve ekonomi teorisiyle erken Erik Olin Wright’ın nedensellik teorisine başvurmakta ve bu arada söz konusu teorileri yeniden değerlendirmekte, öbür taraftan ise, Anwar Shaikh ile Ertuğrul Ahmet Tonak’ın üretken olmayan emek tartışmasına yaptıkları katkıdan destek almaktadır. Bir bütün olarak bakıldığında bu tez, kimlikten ziyade ekonomi ve siyasete vurgu yapmak; iç dinamikler ile devletler arası siyaset–küresel ekonomi politik arasındaki ilişkileri modellemeye çalışmak ve; bugünkü Kıbrıs Türk toplumunu tanımlayan iktidar ilişkileriyle genel krizin kökenleri ve nedenlerini açıklayacak kritik dönemi 1960–1967 olarak görmek suretiyle mevcut literatürden farklılaşmaktadır. Bu amaçla, metodolojik olarak 1960–1963 (Kıbrıs Cumhuriyeti ortak devleti) ile 1964– 1967 (anklav yaşamının ilk evresi) alt dönemlerine uyguladığı tarihî ve ampirik olarak temellendirilmiş bir kavramsal çerçeve geliştirmektedir. Tezin ana içgörüsü ve iddiası, milliyetçi Taksim projesinin iki kilit alt süreci olarak gördüğü devlet inşası ile sermaye birikimi arasında köklü bir çelişki bulunduğu ve bunun da, 1974 sonrasındaki patronaj ilişkilerine dayalı devlet iktidarının ortaya çıkışıyla bugün içerisinde düştüğü krize ışık tuttuğudur. Son olarak ise, teorik olarak, Kıbrıs Türkleri örneği Jessop’ın devlet ve Wright’ın nedensellik teorilerine ait kilit ögeleri (diğerleri arasında, Jessop’daki ilişkisellik ve stratejiklik ve Wright’daki yapısal belirlenim) desteklemektedir.

Anahtar Kelimeler: Kıbrıs Türk Siyaseti, Taksim, Kıbrıs Türk Ekonomisi,

Devlet Teorisi, Ekonomi Politik, Devlet İnşası, Nedensellik, Belirlenim, Üretken Olmayan Emek

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I

N

L

OVING

M

EMORY OF

Kemâlettin Savaş

(Kerim Özgür–Kemal Usta)

(1953–2013)

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ACKNOWLEDGEMENTS

This thesis could be marking the end of my long voyage as a student. Accordingly, I owe a great many teachers, not only intellectually, but for the moral training they have proferred. The fact is that this acknowledgment will probably fall too short of expressing my true gratitude. Nonetheless, I should like to extend my thanks

To my Lycée Saint Joseph teachers, Türkân Ergüven, Cher Frère Georges (F. Pascal-Georges—Jean Gavlak), Frère Colléter (F. Cyrille-Raphael—Jean Colléter), and Mişel Tagan. Madame Ergüven gave us the best a teacher could ever give, care and love for students; Frère Colléter taught us not only mathematics, but interestingly enough for a man of his strictness, our very first lessons in deliberative democracy. Monsieur Tagan introduced us to French literature, and most importantly, to French literature and the political thought of Enlightenment— amongst others, les philosophes de l’Age des lumières. More then three decades are now past, and I still so often think of Monsieur Tagan, very fondly, still admire his great intellect, and his gentleness.

To my Middle East Technical University, Department of Economics teachers Fikret Şenses, Oktar Türel, and Fikret Görün. They taught us, not only economics, but all the intellectual and ethical standards of the profession, as well. All three did whatever they could to protect us, as the undergraduate students of the early 1980s, from the many ravages inflicted upon the university and the Department of Economics, by the dark régime of 12 September.

To my Middle East Technical University, Department of Mathematics teachers İsmail Gül, Hurşit Önsiper, Zafer Nurlu, and Tozun Terzioğlu, who taught me calculus, algebra, and analysis. Professor Gül, a true sage and and a lifelong friend, introduced me to the wonderful abstract world of theorems and proofs. I have had the happiness of being amongst the very first students of Professor Önsiper. In class, Professor Nurlu was one of the best professors I have ever seen. To all four do I owe, my obsession for precise thinking, if not capacity.

To my New School Graduate Faculty Department of Economics teachers, the late David Gordon, the late Robert Heilbroner, Thomas Vietorisz, Willi Semmler, Edward Nell, and Anwar Shaikh. I could not conceive this thesis, without the theories and ideas they transmitted—some, personally worked out by themselves as brilliant theorists. The economic thought of Professor Shaikh, particularly, has left a great mark upon my understanding of Marxist political economy.

To my Middle East Technical University, Department of Political Science teachers, Galip Yalman, Ergin Yıldızoğlu, and Cem Deveci. Professor Yalman, ‘the’ teacher of so many others as well, did more than anyone else to revive my academic career. And most importantly, he introduced me to the theories of the state—one of the theoretical pillars of my master’s thesis, and also supervised my thesis. Professor Deveci provided excellent prothesis guidance, and drew my attention to the importance of cycles of contest theory. Professors Korkut Boratav and Oktar Türel were the jury members of my dissertation committee, and I should like to seize this opportunity to re-thank.

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To my İstanbul Bilgi University Department of Political Science teacher, Murat Özbank. When I came to Bilgi, I had just newly converted to Habermas’s theory of democracy. There, I met Professor Özbank. He introduced, myself and others, to the various theories of democracy, and most importantly, the many finesses of Habermas’s thinking. It is due to his excellent guidance that I did so well at the qualifications. Özbank is a very bright scholar, and a very gentle soul. And last but not least, he is one of those who led the unionisation drive at Bilgi University, through which I have had the great pleasure of working together.

And to Korkut Boratav. It is one of the luckiest chances of my life that he, as our union consultant, supervised our research efforts during my Harb-İş years of 1994– 1999. Professor Boratav is ‘the’ teacher of all of us as many generations of radically oriented political economists have been inspired by his work, integrity, and kindness. I am truly grateful for his continued concern and support for my professional and academic career.

One of the key component parts of my intellectual assets is my critical studies over the labour movement. In this respect, I owe greatly to the original ideas of Erkan Arslan, concerning, most particularly, the question of the democratisation of labour unions. I have worked a lot on labour education, both theoretically and practically, and the first impulse for this was provided by the works of Murad Akıncılar. I should like to note that, my Harb-İş years were particularly productive due to the tremendous importance attributed to research and education, by its leading cadres, and particularly, its president, İzzet Çetin. As the leader of Gölcük’s shipyard workers that sparked the so-called Spring Actions of 1989, he was one of Turkey’s most enlightened trade unionists. Leman Kiraz, the Education Secretary of BES in the early 2000s, besides being a great friend, was the best education secretary I have ever seen. Through the years 2003–2005, I was the parliamentary advisor of former Minister of State Abdülkadir Ateş. Given his integrity, knowledge and experience, he was a great asset for politics—certainly, of the kind most needed then and now. I should like to seize this opportunity to thank the latter two for all the support they gave to my efforts to revive my academic career.

A trip to Cyprus in the mid 1990s, upon the invitation of the President of TES Bayram Karaman to establish a research centre to study the social and economic problems of Northern Cyprus firstly occasioned my interest in Cypriot studies. Mr. Karaman was one of the most far–sighted, honest trade unionists in Cyprus, and a great friend. Mete Hatay, and his early enquiries into the T/C culture played a key role at arousing my interest in T/C life and society. He is certainly one of the brightest students of the field. I should like to thank Mehmet Hasgüler too, for introducing me to the various aspects of the Cyprus issue and T/C politics. What I have achieved in life, I absolutely could not, had I not have the support of my family and close circle of friends.

So, I owe heartfelt thanks

To my family, my late father Osman Arslan, my mother Mücevher Arslan, my older sisters Fatma Savaş and Saliha Arslan, my brother-in-law Erkan Arslan, my late brother-in-law Kemâlettin Savaş, my nephew Özgür Savaş, who have always and by all means supported my scholarly pursuits, and to my nephews Deniz Arslan, Serpil Savaş, and grand-nephew Elif Savaş, for being the joys of my life.

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To my ‘alter’ family, Sevinç and Hakan Mıhçı, and dearest Coşku, and lifelong friends Taylan Zafer Bâli, Rajiv Sethi, Matt Noyes, Joseph Roccasalvo, Murat Özveri, Nedim Durmuş, Hasan Yok, Feyza Tulga, Aslı Silahdaroğlu, Aslı Odman, Veysi Kondu, Mehmet Sevim, Yonca Demir, and Sema Bayraktar. The memories of Ju Ling Tan and Gregory Rodriguez are always alive.

In the process of my getting of this degree, many people played a key role. I owe thanks to Professor Boğaç Erozan who invested a great deal of effort and energy in preparing us, the Ph.D. students for the qualifications. Also do I owe, to the members of my dissertation jury, Gencer Özcan, Galip Yalman, İlay Romain Örs, and Pınar Uyan for their encouragement, critiques, and their excellent guidance. Professors Romain Örs and Uyan were a source of constant support, and their commentaries crucially contributed to the ending of this thesis. From Uyan, I also learned the theories of social policy, and her reading of the various drafts of my thesis, and her suggestions thereof were most conducive to giving it a better shape. Hakan Mıhçı, Sevinç Mıhçı, Umut Bozkurt, Taylan Zafer Bâli, and Veysi Kondu also read the various drafts of this thesis, contributing useful commentaries.

I can still very freshly recall how I first met E. Ahmet Tonak, on a certain day of 1991, at the Computer Instruction Centre of the New School, to discuss the production of the charts and graphs that were to adorn a forthcoming book— ‘Measuring the Wealth of Nations’, of which he and Anwar Shaikh were the co-authors. As it turned out, our ways would cross many more times. In 1997, whilst I was still working for Harb-İş, he happened to pass his sabbatical leave teaching at the Economics Department of the Middle East Technical University. He wrote a booklet for Harb-İş, where he introduced the reading public in Turkey to the debate on the Multilateral Agreement on Investments (MAI). Shortly after I started the Ph.D. programme here, he ended his long residence in the United States, and came to the Economics Department of Bilgi University. In 2009, he established a master’s programme in international political economy—the first ever in Turkey, where we customised a methodical course together, which I then taught for three years in a row. Professor Tonak was the presciently efficient advisor of this thesis. Not only did he make get the things moving, but also changed the entire course of the thesis, from a theoretically informed treatise of history, to a critical reconsideration of certain substantive issues in the theories of the capitalist state and political economy, in the light of the specific case of the T/Cs. Also, his and Shaikh’s elaboration of the theory of productive and unproductive labour provided one of the theoretical pillars of this thesis. The significance of their contribution could not be overstated: As I see it, the truly monumental work of ‘Measuring the Wealth of Nations’ critically complements Marx’s Capital, providing the latter with the proper empirical basis which it lacked for 130 years or so after its first appearance.

The days of the final editing of this thesis were sorrowful times of utmost grief, as I suffered the loss of one of the most loved ones in my life, my dearest brother–in– law ‘Kemâl Abi’. All I am left with now after his passing away is the little consolation that I was lucky enough to have shared 35 years of his beautiful short life. He was the true son, ‘the noble protagonist of the proletariat’...

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LIST OF TABLES

Table 3.1. Jessop’s Stylised Model of the Capitalist State

Table 3.2. Bob Jessop v. Erik Olin Wright: Theories of Causality and Elements to be Reconsidered

Table 3.3. An Historically–Empirically Grounded Conceptual Framework

Table 3.4. Statistical Data by Ethnic Group: Greeks and Turks on Cyprus

Table 5.1. The Economy of Cyprus, 1960

Table 5.2. Percentage Communal Contributions to GDP: Estimates by Panagides for 1963

Table 5.3. Manufacturing Industries, 1962, by Ethnic Group Table 5.4. Statistical Data by Ethnic Group: Greeks and Turks on

Cyprus

Table 5.5. Evkaf Finances, September 1961

Table 5.6. Trends in the Numbers and Composition of Cooperatives Table 5.7. Cooperatives: Rest–of–the–World Sources (September

1961)

Table 5.8. Central Bank of Cooperatives (September 1961)

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ABBREVIATIONS

AFU: Armed Forces Union

A.K.E.L./AKEL: Anorthotikó Kómma Ergazómenou Laoú [the Progressive Party of Working People]

AKP: Adalet ve Kalkınma Partisi [Justice and Development Party] AP: Adalet Partisi [Justice Party]

CD&W Act: Colonial Development and Welfare Act CHP: Cumhuriyet Halk Partisi [Republican People’s Party] CTP: Cumhuriyetçi Türkiye Partisi [Republican Turkish Party] CTP–BG: Cumhuriyetçi Türkiye Partisi–Birleşik Güçler [Republican

Turkish Party–United Forces]

DP: Demokrat Parti [Democratic Party (Turkey)] DP: Demokrat Parti [(T/C) Democratic Party]

DPÖ: Devlet Planlama Örgütü [SPO: (T/C) State Planning Organisation] DPT: Devlet Planlama Teşkilatı [SPO: State Planning Organisation

(Turkey)]

EEC: European Economic Community ECHR: European Court of Human Rights ECJ: European Court of Justice

EOKA: Acronym for Ethnikí Orgánosis Kipriakoú Agónos [National Organisation of Cypriot Struggle]

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G/C: Greek Cypriot

GDP: Gross Domestic Product

GKK: Güvenlik Kuvvetleri Komutanlığı [Command of Security Forces] GNP: Gross National Product

IMF: International Monetary Fund

KİT: Kamu İktisadi Teşebbüsü [Public Economic Enterprise]

KKTC: Kuzey Kıbrıs Türk Cumhuriyeti [TRNC: Turkish Republic of Northern Cyprus]

KTFD: Kıbrıs Türk Federe Devleti [Turkish Federated State of Cyprus] MBK: Millî Birlik Komitesi [NUC: National Unity Committee]

NATO: North Atlantic Treaty Organisation NGO: Non-Governmental Organisation

NUC: National Unity Committee [MBK: Millî Birlik Komitesi] TBMM: Türkiye Büyük Millet Meclisi [Grand National Assembly of

Turkey] T/C: Turkish Cypriot

TKP: Toplumcu Kurtuluş Partisi [Communal Liberation Party] TL: Turkish Lira

TMT: Türk Mukavemet Teşkilatı [Turkish Resistence Organisation] TRNC: Turkish Republic of Northern Cyprus [KKTC: Kuzey Kıbrıs Türk

Cumhuriyeti]

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CHAPTER I

INTRODUCTION

This thesis rests, to a great measure, upon two key observations as regards to the state of Turkish Cypriots (henceforth, denoted by the customary acronym of T/Cs) studies. The first is the oversight of domestic dynamics, generally, and of the economy and politics, more particularly, and; the second, the oversight of theory and methodology, generally. As I see it, narratives of events supported by remarks upon observed connections between intrinsic and extrinsic dynamics, and economy and politics within specific contexts do not, by themselves, suffice to ensure a theoretically informed analysis. Thus, my first starting point was to write a ‘theoretical’ narrative of the economy and politics of the T/Cs, from the perspective of the theories of the state, and political economy, for the period of 1960 to 1983.1 More particularly, it was my desire to elucidate the origins of the

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Accordingly, the basic unit of analysis of the present study is the ‘T/Cs’, or the ‘T/C community’—as they were called under the Ottomans, the British, or the Republic of Cyprus, or the ‘T/C society’—as they were called, particularly, following the foundation of the territorially separate T/C state, after the split of the Island in 1974. Therefore, the question that follows is one of analytically defining the ‘entity’ called the T/Cs, or the T/C community, or society. As I see it, there are two problems associated with this task: Firstly, one must discuss, as a problem which is particular to the case of Cyprus, the appropriateness of using T/C, as a noun, or epithet to tag the entity in question. It is important to note that this question concerns the politics of identity, underlying the deepest rifts within Cyprus. In Northern Cyprus, nationalists prefer ‘Kıbrıs Türkü’ (best translated as the ‘Turks of Cyprus’), putting the emphasis on ‘Turk-ness’, whereas the pro-Republic (implying the common Republic of 1960) and/or pro-unification Leftists and liberals prefer ‘Kıbrıslı Türk’ (Cypriot Turks), or ‘Kıbrıslıtürkler’ (Cypriotturks), as the more radical version of the latter, putting the emphasis on the common, Islander’s identity of Cypriot-ness. I will be adressing these debates in Chapter II below, and extensively. Secondly, there is the problem of generally defining the identity in question, as a society (or community), to be more exact, the problem of defining society, theoretically, i.e. as a concept. Clearly,

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current crisis of the T/C society, through the elaboration of the connections between the first constitution and the further reproduction of the relations of political power, on the one hand, and the economy, on the other. However, in due process, there were two modifications—the first, suggested by the Advisor of the thesis, and the second by necessity:

1) From an historical narrative of the T/C society informed by theory, the focus shifted to the rethinking of specific theories using the historical–empirical material as relates to the T/C society, namely the state theory of Bob Jessop, and the theory of causality of the early Erik Olin Wright;

2) I ended up covering the period of 1943–1967, rather than 1960– 1983, as I came to realise that, firstly, the coverage of the sub-period 1943–1960 was necessary to comprehend the two key sub-periods of 1960–1963 and 1964–1967, and; secondly, that I would not be able to cover the post-1967 sub-periods, as that would expand the volume far beyond the customary limits of a doctoral thesis.

different characterisations of of identity are associated with different actors, contending for different projects of society, or societalisation. According to Jessop (1990: 4–5), ‘society’, in its unstated meaning, “… refers to the social processes in and through which ‘society effects’ are produced. The premiss of this approach is that the exercise of a ‘society’ cannot be taken for granted: it must be constituted and reproduced through more or less precarious social processes and practices which articulate diverse social relations to produce a ‘society effect’.” On the other hand, ‘societalisation’, in its generic use, “… covers the complex social processes in and through which specific institutional orders and their broader social processes are secured.” Furthermore, “… there is ample scope for conflict over societal projects that privilege radically different organisational principles as well as for conflict over rival projects based on the same principle.” (Jessop, 2005: 22) Nation-building (new nations), and capital accumulation (bourgeois societies) are two such principles. One of the basic ideas underlying this study is that the project of nationalist state-building encompasses the dual, sometimes contradictory, organisational principles of nation-building, and capital accumulation.

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1.1. OUTLINES:BASIC PROBLEMATIC,METHOD, AND PLAN

Let me now try to clarify what I have said above, by briefly presenting the basic outlines of the thesis, in terms of its basic problematic, method, and plan.

Since the Helsinki Summit and the financial crisis of late 1999, the T/C society has been riven by what I have called a ‘generalised crisis of statehood’, i.e. a crisis encompassing all the basic properties and functions characterising the modern state. As it appears, it is difficult to attribute the origins of the generalised crisis to external dynamics alone—most notably, the process of Europeanisation. More specifically, domestic dynamics appear to have risen to prominence in the last two decades or so, and had major repercussions in the area of foreign policy. This is broadly, the historical background against which this thesis has been written. As a theoretically informed analysis of the deeper roots of the present crisis of the T/C society, and a theoretical narrative of thus far neglected a part of the T/C history, this thesis differs from much of the existing literature in a number of ways:

1) It focuses upon economy and politics, and the relationships between the two, from the perspective of the theories of political economy and the state, as opposed to the recent works focusing upon identity, from the perspective of the theories of nationalism and cultural studies;

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2) it engages, theoretically, to expound and model the relationships between the level of domestic dynamics, on the one hand, and the levels of inter-state politics and global political economy, on the other, and, finally;

3) it regards the period of 1960–1967, as the critical episode to which the origins of the power relations and generalised crisis characterising today’s T/C state and economy are to be traced back, as opposed to those studies bringing to the fore, as the decisive moment, the socio– economic arrangements of the immediate post–1974 years.

I must also note that, to the best of my knowledge, this thesis provides the first comprehensive survey of the literature on the T/Cs, and one of the few comprehensive narratives of the T/C economy and politics from the late 1950s, through the late 1960s. In so doing, it brings into the light, a number of interesting points which have thus far been neglected, e.g. the key role of the development planning in the British efforts to reform and stabilise Cypriot politics, the key role of economic considerations and (development) policies in the strategic calculations of the T/C leadership, the crisis dynamics underlying the enclave years of the T/C community, the mark of the enclave period upon the construction of the patronage relationships characterising the politics and economy of the post-1974 society.

One must point out that, much of the past literature on the T/Cs has typically treated the latter as the passive actors of a problem basically concerning the

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field of inter-ethnic and inter-state relations. As a matter of fact, studies concentrating upon the domestic dynamics of the T/C society have only recently proliferated. Furthermore, much of this novel work tend to focus upon the question of identity, through the theories of nationalism and cultural studies. On the other hand, most students of the T/C nationalist politics emphasise the key role of the relationships between economy and politics as the key to comprehending the constitution of nationalist politics, the relations of power, and the generalised crisis now characterising the T/C society. As a matter of fact, one of my core critiques of the existing literature, and one of the key points of departure of this thesis is that, those scholars who argue for the centrality of the relationships between politics and economy tend to speak of the economy without recourse to political economy, and of politics without recourse to the theories of the state. Accordingly, in this thesis, I have tried to focus on the sub-processes of state-building and capital accumulation amongst the T/Cs, from the point of view of the Marxist theories of the state and political economy. Since nationalist politics aimed not only at the modernisation of culture, but also of politics and the economy, I would argue that my work usefully complements existing studies of nationalist politics treating the issue from the point of identity. Let me finally note that, the role of the economy in T/C politics has best been studied, theoretically, by the students of patronage theory. I believe that this thesis, by bringing into light how patronage networks were the key to the constitution of state power, has successfully placed the question of patronage—typically treated as the subject of a

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‘middle range’ theory—into its right context, i.e. the theory of the capitalist state.

One of key concerns of the students of the T/C politics has always been the nature of the relationships between the T/Cs and Turkey—the ‘Motherland’. As a matter of fact, in the case of the T/Cs, this is the way that the broader question of the connections between the level of inter-state politics, and the level of domestic dynamics comes up. It is important to note that most students of the history of T/Cs and of the Cyprus issue tend to argue that the T/Cs, being politically and economically fully dependent upon Turkey, were simply the passive recipients and bearers of the consequences of the latter’s policy decisions. As I see it, this approach often leads to the theoretical error of minimising or totally ignoring the domestic dynamics of the T/C society, and, most importantly, the key role of the nationalist drive towards state-building. This thesis indicates that the relationships between domestic and external dynamics were far too complicated to fit into this image of one-sided dependency. Below, I engage the preliminary task of expounding and modelling the relationships between the level of domestic dynamics, on the one hand, and the levels of inter-state politics and global political economy, on the other.

The specification of the relationships between politics and economy as the key problematic of this thesis naturally led me into going back to and rethinking aspects of the Marxist debate on the capitalist state and Marxist political economy. It is only well too known that the distinguishment of the

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spheres of economy (civil society) and of politics/state (political society), and the theorisation of the relationships between the two was the basic problematic driving Karl Marx’s lifetime work. Theoretically, this thesis draws upon the state theory of Bob Jessop, and the theory of causality of ‘early’ Erik Olin Wright, complemented by the approach to the so-called problem of productive–unproductive labour of Anwar Shaikh and Ertuğrul A. Tonak. The original leitmotiv of the works of Jessop and Wright was the need to criticise and supersede the ossified ways of the old official Marxist school, as well as the limits of the Althusserian idea of the structured, overdetermined whole, dominating, in the 1970s, Western neo-Marxist thought. Thus, whilst Jessop challenged ‘reductionist’ approaches of all sorts to the problem of the capitalist state—comprising its finer variants as the Althusserian ‘determination in the last instance’, Wright challenged the ‘obscure’ and ‘speculative’ formulations of the relationships of causality between the economic structure and the other elements of the ‘structured whole’. Methodologically, this thesis pursues a double strategy: a) It draws upon the theories of Jessop and Wright to build an historical–empirical framework to study the case of the T/Cs, and; (b) puts aspects of their theories to the test by making use of the historical–empirical material as relates to the economy and politics of the T/Cs. One of the key distinctions of the work of Jessop and the early work of Wright is that the former was basically inspired by Antonio Gramsci and the late, neo–Gramscian Nicos Poulantzas, whilst the latter, by Louis Althusser. Jessop’s theory of the state basically relies upon two critical ideas, that of relationality, and

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strategicness. As for (the early) Wright, his basic task was to break down the global concept of structural causality into its finer variants, namely, the six basic modes of determination—structural limitation, selection, reproduction

versus nonreproduction, limits of functional compatibility, transformation,

and mediation. Furthermore, he expanded the concept of structured whole into the various models of determination.

In the light of Bob Jessop’s theory of the capitalist state and economy, and Erik Olin Wright’s theory of causal determinations, I have formulated an historically and empirically grounded conceptual framework to study the successive episodes of the T/C history, with a view to lay bare, particularly, the relationships of causality between politics and economy. Looking vertically, the framework in question involves, using the International Relations terminology, multiple levels of analysis, more specifically, the inter-state (USA, GB, Turkey, Greece), and the global (International Political Economy) levels. Thus, I argue that, on a first level, the given conjuncture of world politics, political and economic conjuncture in Turkey, and the conjuncture of international political economy (dominant development strategies, policies and policy tools) together determine the externally-given constraints and possibilities faced by T/C nationalist leadership. On a second level, externally-given constraints and possibilities,

and the domestically-given constraints together determine the range of the

options for strategic choices regarding the problems of state-building and capital accumulation. However, despite the fact that it broadly suggests that the various inter-state and domestic political, and economic factors together

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determine the range of options for strategic choices regarding state-building and capital accumulation, this conceptual framework does not make any a

priori claims about the direction of causality, either between the various

levels, or between politics and economy. Therefore, it is open, rather than being rigidly closed, in the sense of foretelling the results it purports to find out. As a matter of fact, the full implications of the framework as to the direction of causalities became clear, to myself, only after it was applied to the historical–empirical material of the T/C politics and economy. Furthermore, the framework in question temporally and dialectically links the successive stages of the T/C history. Overall, strategic choices reflect strategic constraints, possibilities, options, and policy (or, political) priorities. Each strategic choice gives way to a different set of relations, and modes of determination between politics and economy, and thus, each strategic choice brings about a new set of contradictions, underlying the politics of the sub-period under study. Such conflicts, together with the changes in the conjuncture of world politics and the political and economic conjuncture in Turkey, eventually lead to change.

The results of the study are given at the end of Chapter 5 and Chapter 6, covering the two sub-periods of 1960–1963 and 1964–1967, respectively, and summarised, in toto, in the Conclusion. Accordingly, here, I will only highlight a number of key results. Firstly, any reductionist arguments as to the relationship of economy and politics, attributing, for instance, the policy decisions of the T/C nationalist leadership to capitalist class interests and/or the needs and requirements of capital accumulation appear to be difficult to

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support. On the other hand, the relationships between domestic and the external dynamics appear to have followed a rather complicated, and somewhat cyclical pattern that clearly contradicts the linear view of one-sided dependency. Thus, despite the fact that external actors do often have the capacity to dictate the ground rules to which domestic actors are expected to obey, the latter, on their turn, generally prove, in due process, their ability to defy the rules and compel external actors to radical revisions.2

On the other hand, so far as the theories of Bob Jessop and Erik Olin Wright are concerned, the following study of the T/C economy and politics gives support to a number of key ideas. As I see it, the major elements of Jessop’s strategic–relational approach to the state theory—most importantly, his distinction of structural constraints versus conjunctural opportunities, provide a most suitable framework for the analysis of the T/C economy and politics. Furthermore, historical–empirical material appears to support several elements of his theory—for instance, his conceptions of interest, temporal and spatial horizons, of the society consisting of the sum of various autopoietic systems implying rival societal and state projects, and

2

From another perspective, the Cyprus issue involves the asymmetrical relationships of power amongst, broadly speaking, three classes of states/societies—using the terms of William Hale the ‘Great Powers’, the ‘Middle Powers’, and the ‘Small Powers’. Thus, “[m]iddle powers stand somewhere between the two extremes of the scale – that is to say, they have some ability to resist pressure from more powerful states, … may sometimes be able to influence the policies of weaker ones, especially if they are geographically contiguous, … [and] [t]hey may possess some regional power, but cannot expect to be able to influence global politics more than marginally.” (Hale, 2002: 1–2) On the other hand, “[A]s Robert Rothstein puts it, ‘the Small Power may move not from insecurity to security, but from insecurity to the status of a satellite.” (Hale, 2002: 2). This thesis challenges ‘Turkey’s satellite’ view of the T/C society and state.

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the idea of the state as a site of strategy. On the other hand, Wright’s idea of structural determination, namely, that some basic structure—the economy, for instance, puts limits upon or determines the forms of other structures is the key to understanding the critical role played by one specific type of constraint that will be brought up below, namely, the low capacity of the T/C society to generate the surplus product necessary for the success of the nationalist project of state-building. Incidentally, I must note that, in my analysis, I have brought together Wright’s idea of structural limitation and Shaikh and Tonak’s theory of unproductive labour, by arguing that the T/Cs low capacity to generate the surplus product necesary for the sustenance of unproductive state activities constitutes a structural limit upon the politics of state-building.

As far as the relationships of between the two sub-processes of the nationalist project, namely, state-building, and capital accumulation are concerned, the results of this study tend to refute any reductionist theory, putting to the core class interests, and/or the needs and requirements of capital accumulation alone. As a matter of fact, the T/C case appears to support (1) the idea of a ‘dialectical’ relationship between economy and politics, (2) as two operationally autonomous but materially interdependent sub-ensembles of social relations, where (3) the economic structure puts limits upon the form of the state and politics. Thereby justified, respectively, are (1) Wright’s conception of dialectics, (2) Jessop’s idea of autopoiesis, and (3) Wright’s idea of structural limitation. More specifically, in the case of the T/Cs, I argue that the historically given constraint of the low capacity

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of the society to generate the surplus product necessary for the sustenance of state functions gave rise to a fundamental contradiction between the two elements of the nationalist project, namely, the politics of state-building, and the needs and requirements of capital accumulation. The nationalist leadership, being unable to supersede this contradiction on a permanent basis, resorted to ways that gave rise to today’s heavily criticised and clearly unsustainable politics and economy. The process of state-building involves, as sub-processes, the production of ideology, the constitution of legitimate monopoly over the means of violence, the concentration of political power, the creation of economic policies and tools to ensure the capital accumulation, the construction of a centralised administrative apparatus, the creation of territory, and the institutionalisation of taxation and budgeting. State-building has positive and negative effects upon capital accumulation. On the one hand, the monopolisation of violence, the creation of territory, the constitution of economic policies and tools, and the institutionalisation of budgeting together directly and indirectly support the process of capital accumulation. On the other hand, the creation of army and police, and the bureaucracy expand the scale of unproductive activities, and constitute a drag on the process of capital accumulation due to its absorption of a considerable portion of the surplus product. A critical constraint faced by the nationalist leadership in its drive towards state-building was the low capacity of the T/C society to generate the surplus product necessary for the sustenance of state absorption. On the other hand, capital accumulation requires (a) the allocation of social labour primarily to productive activities,

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and (b) political, administrative, geographical stability. However, the politics of state-building of the T/C nationalist leadership, namely Taksim, was based upon a strategy of political and, particularly, geographical (territorial) destabilisation, and required the allocation of critical portions of the total social labour to military activity, i.e. to non-production. According to the politics of Taksim, the co-existence of the two communities from the point of view of geography, demographics, and the various activities of social reproduction (production, distribution, and personal consumption) was a major obstacle to the process of state-building. Therefore, the politics of Taksim was based upon the strategy of the disruption of geographical– and demographic stability, having adverse effects upon the process of capital accumulation.

The full implications of the contradiction between the sub-processes of state-building and capital accumulation caused by the historical constraint of low surplus product became clear only after the retreat of the T/C community into the enclaves. As I see it, the origins of the rise of the post-1974 relationships of patronage, and the causes of their crisis can, to a large measure, be traced back to this fundamental contradiction. The contradiction in question, latent under the common state of the Republic of Cyprus (1960– 1963), effectively became a source of crisis under the circumstances of the first phase of the enclave life (1964–1967). Furthermore, the resolution of this contradiction led the T/C nationalist leadership to laying down, as the basis of state power, the cultural and institutional foundations of a wide network of patronage relationships. However, the lack of necessary

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resources was a major constraint prior to 1974 preventing the full– consolidation of the patronage network. This constraint could only be eased after 1974, largely thanks to the net transfer of wealth—means of production and means of subsistence—from the G/Cs to the T/Cs. Overall, ganimet [the loot, implying the expropriation of properrty left by the fleeing G/Cs], and extensive state employment, social policies, and the low level of extraction financed out of the fiscal transfers of Turkey, considered by the leaders and the populace at large, as rightfully earned (re)compensation for the hardships of the enclave life and the military labour of the populace, provided the material basis for the consolidation of the clientalist relations of power of the post-1974 years.

Below is the plan of the thesis:

 The first and introductory chapter is devoted to the exposition of the origins, the basic problematic, and the basic ideas of the thesis, as well as the problems of (a) the proper periodization of the T/C history, and (b) the all too important problem of small states and economies, and its implications for the thesis.

 The second chapter (CHAPTER 2. OVERVIEW OF EXISTING LITERATURE ON CYPRUS) of the thesis provides a critical review of the existing

Turkish literature on the T/Cs. For reasons that should become clear in due process, part of this chapter comprises a treatment of the major aspects of the current crisis of the T/Cs, which I call, a generalised crisis of statehood.

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 The third chapter (CHAPTER 3. OF THE RELATIONSHIPS BETWEEN

ECONOMY AND POLITICS/STATE) is a critical review of the of the theories

of the state, and political economy, with particular emphasis upon the state theory of Bob Jessop, and the theory of causality of Erik Olin Wright. At the end of this chapter, I suggest a model to test the two theories in the light of the empirical–historical material on the politics and economy of T/Cs.

 The fourth chapter [CHAPTER 4. T/CPOLITICS AND ECONOMY, AND THE

CYPRUS ISSUE PRIOR TO ZURICH–LONDON is the first of the three

empirical chapters, which provides an account of the dual nationalist strategy of state-building and capital accumulation of the pre-1960 period, of the genesis of the Cyprus issue, and a summary account of the conjuncture of world politics prior to Zurich and London Agreements.

 The fifht chapter [CHAPTER 5. REPUBLIC OF CYPRUS, THE COMMON

STATE (1960–1963)] is the second of the three empirical chapters, which gives a chronological narrative of the world conjuncture, and the politics of and economy of the T/Cs, organised in accordance with the historically and empirically grounded conceptual framework expounded in Chapter 2. The basic goal of this chapter is to rethink the theories of Jessop and Wright, in the light of the historical–empirical material of T/C politics and economy, for the sub-period of 1960–1963, the Common state of the Republic of Cyprus.

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THE PROTO-STATE (1964–1967)] is the last of the three two empirical

chapters, which is a chronological narrative of the world conjuncture, and the politics of and economy of the T/Cs, now for the sub-period of 1964–1967, when the T/Cs lived estranged from the polity and economy of the Republic of Cyprus, inside the heavily fortified urban neighborhoods and large villages. The basic goal of this chapter is also to rethink the theories of Jessop and Wright.

 The CONCLUSION basically comprises a brief presentation of the overall results of this thesis as well as some key questions that are likely to guide my future work on the problem of causality, in the field of International Relations, and on Cyprus.

1.2. PERIODISATION AND THE CHOICE OF THE PERIOD UNDER STUDY

A note to clarify the rationale behind the choice of, specifically, the sub-periods 1960–1963, and 1964–1967 now seems to be in order. From the point of view of the core sub-processes of state-building, capital accumulation, and the patterns of the relationship between economy and politics/state, T/C history can be periodised as follows:

(i) (1943–1960) De-colonisation, Intra-elite Power Struggle, Taksim; (ii) (1960–1963) Republic of Cyprus, the Common State;

(iii) (1964–1974) “Enclave” Life, the T/C Proto-State;

(iv) (1974–1983/1986) Consolidation of the T/C State, Foundation of the Independent State;

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(v) (1986–1999/2000) “First-wave” Neoliberal Reforms, and Generalised Crisis;

(vi) (2000–Present) Anti-crisis Measures, Finance-led, Speculative Growth and Crisis; “Second-wave Neoliberal Reforms.

Note that, sub-periods i) through iv) cover the genesis, further evolution, and the consolidation of the post-1974 pattern of politics and economy. And, sub-periods v) and vi) cover the deconstruction, i.e. the crisis and the transformation of the post-1974 patterns of politics and economy.

(i) (1943–1960) De-colonisation, Intra-elite Power Struggle, Taksim

1943 bore the first signs of a political thaw on the Island, which opened before the T/C elites a window of opportunity for political mobilisation. Amongst the T/Cs, this marked the beginnings of an intra-elite struggle which led to the rise of the nationalist project of state building, as well as the emergence of the basic elements of future state structures, including the process of capital accumulation.3

(ii) (1960–1963) Republic of Cyprus, the Common State

While giving further impulse to state-building through the constitution of full-fledged parliamentary and administrative organs, the foundation of the Republic of Cyprus also obstructed the “separatist” project of state-building and capital accumulation.

3

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Discursively, the Cyprus issue is posited by the nationalists of both sides as a question of the violation of rights, and a question of security. According to the Greek Cypriots (henceforth G/C) nationalists, the Zurich and London Agreements which led to the establishment of the Republic of Cyprus had violated the rights of the G/Cs. According to the T/C nationalists, the conflict triggered by the events of 23 December 1963 had given rise to the violation of their rights and raised a serious question of security. See Evre (2004: 29).

(iii) (1964–1967) “Enclave” Life, the T/C Proto-State (Phase I)

The “enclave” period witnessed to the emergence of the autonomous, T/C proto-state, and the constitution on a large scale of the distributive role of politics in the allocation of economic resources, largely financed by the fiscal transfers from Turkey.4 During the common state of the Republic of Cyprus, the T/C nationalist leadership only partly shared in the powers of the centralised state apparatus. In 1964, the TMT assumed the responsibility of all the centralised functions of the enclaved T/C proto-state. Therefore, to the separate functions of the communal–

4

This is a basic point where I differ from other students of T/C politics, except, perhaps— Salih Egemen and Yael-NavaroYashin—in that, I see the beginnings of the post-1974 relationships of patronage in the pre-1974 period, particularly, in the enclave period of 1964–1974. Thus, Navaro-Yashin similary sees the dynamics of the enclave period as the key to understanding todays relationships: “To properly analyse Turkish-Cypriot attachments to civil service and the affects this engenders, we need to return to the period, in the 1960s, when Turkish-Cypriots were estranged from the Republic of Cyprus and first began to form their own separate state administration. In other words, we need to turn to the period when the structure for this specific unrecognised state administration was first set.” (Navaro-Yashin, 2006a: 285)

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local state under the Republic, now added, were the functions of a central state apparatus.

(iv) (1968–1974) “Enclave” Life, the T/C Proto-State (Phase II)

The first phase of the “enclave” period concluded with outbreak of a violent triple crisis, (a) within the G/Cs, between the ‘anti-Enosis and/or independentist’ G/C nationalist forces of Makarios, and the pro-Enosis forces of Makarios; (b) between G/C–Greek nationalists and TMT, on the one hand, and Greece and Turkey on the other; (c) within the T/Cs, particularly, the fractions of Dr. Fazıl Küçük, and Rauf R. Denktaş. The T/C proto-state, civil society, and economy were reformed and further institutionalised, and G/C–T/C bi-communal negotiations started.

(v) (1974–1983/1986) Consolidation of the T/C State, Foundation of

the Independent State

The proto-state, modelled on the state of the Republic of Cyprus was greatly extended and partly remodelled after the state of the Turkish Republic. The distributive role of politics was further consolidated through the allocation of G/C property and state allocation financed by the fiscal transfers of Turkey. In 1983, the Turkish Republic of Northern Cyprus [Kuzey Kıbrıs Türk Cumhuriyeti—KKTC] came to replace the Turkish Federated State of Cyprus [Kıbrıs Türk Federe Devleti—KTFD]. This marked the transition from the principle of federation, to the principle of independence, based on the claim of

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the right to self-determination, and thereby, the completion of the T/C nationalist project of state-building. From the point of view of development policies, the sub-period of 1974–1986 was one of Import Substituting Industrialisation (ISI).

(vi) (1986–1999/2000) ‘First-wave’ Neoliberal Reforms, and

Generalised Crisis

In 1986, Turgut Özal introduced the first-wave of neoliberal reforms, namely, price liberalisation, trade liberalisation, and privatisation, which were given further impulse by Tansu Çiller, in 1996–1997. Together with the process of Europeanisation, this sub-period concluded with the banking crisis of 1999, depositors’ riots, and the outbreak of a massive wave of political contest, eventually forcing Denktaş to step aside.

(vii) (2000–Present) Anti-crisis Measures, Speculative Growth and Crisis, ‘Second-wave’ Neoliberal Reforms

This sub-period is one of generalised crisis in politics and the economy. In early 2000, the so-called “Economic Stabilisation Programme” was introduced. This was a prelude to the “good governance” reforms and IMF–style conditionalities of the second half of the decade. This sub-period also witnessed sharp reversals in the fortunes of political actors and parties, the prime example of which being the rise and fall of CTP, and the fall, rise and re-fall of UBP.

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The sub-periods above can be partitioned into three:

A. The sub-period of pre-Republic (of Cyprus) 1943–1960 covers the genesis of the basic elements of future state structures and basic policies of capital accumulation.

B. The three sub-periods of 1960–1963, 1964–1974, and 1974– 1983/1986 together cover the further evolution and completion of the T/C nationalist project of state building, and the consolidation of the distributive role of the state.

C. The two sub-periods of 1986–1999/2000, and 2000–Present cover the neo-liberal era of the de-construction and reform of the post-1974 distributive role of the state.

Chronologically, this thesis covers aspects of “A” (1943–1969) and the first two sub-periods of “B” (1964–1967; 1967–1974) above.

1.3.THE PROBLEM OF ‘MICRO-STATES’ AND ‘MICRO-ECONOMIES’

Methodologically, one of the most disturbing/thought–provocating and challenging problems, on the part of a student of the T/C economy and politics, is that of “micro-states” and “micro-economies”. The very first question is the following: Are, the ‘grand’ theories of the state and political economy applicable to the tiny micro-society of T/Cs? From a theoretical point of view, I tend to think that the answer is affirmative. In other words, theories ‘as concepts and the relationships amongst concepts’ can be used to discuss and theorise the micro case of Cyprus. On the other hand, theories as

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models of the purest, the most developed type of society, in the sense of Marx, or ideal-type models of society, in the sense of Weber, are less useful.

The problem of “micro-states” and “micro-economies” basically boils down to one of scales and scaling. As far as the economy is concerned, the limits to the development of the division of labour—in terms of the input–output economics, backward and forward linkages amongst industries— is one of the major constraints. As far as politics is concerned, the costs to a small society of financing a modern state constitute a major problem. Furthermore, the face-to-face closely-knit relationships of a micro society, leading to some kind of a merger between the political sphere, the public sphere, and the lifeworld, somewhat colors the dynamics of politics.

Let me start with the last and the third point. There is a beautiful letter, written and sent from İstanbul, by the noted T/C Dr. Hafız Cemal (also known as ‘Lokman Hekim’)—who was a great ‘celebrity’ of his times, and published in the 16 June 1934 (183rd) issue of the tabloid Masum Millet [The

Innocent Community]. In his letter, ‘Kıbrıs’ı göreceğim geldi’, Dr. Hafız

Cemal perfectly reflects the emotive state of nearly all T/C intellectuals towards their Island, their historical dilemma of ‘hatred and love’, of ‘leave or stay’, of ‘boredom and exhilaration’:

“… Pek sevdiğim Kıbrıs’a karşı kalbimde beslediğim, ruhumda sakladığım muhabbet, gün geçtikçe arttı, şiddetlendi ve düs-sıla (sıla hastalığı) denilen pek üzücü bir hastalık, kalbimi işgal-i marazîsi altına aldı. ¶Kıbrıs’ta pek bereketli olan dedikodu âlemine! dalarak afakî (gelişigüzel) sözler dinlemeğe, hercaî-meşreb (çapkın) arkadaşlarla görüşmeye arzum arttı!

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¶Büyük ve küçük lordları, kontları, paşaları, beyleri, efendileri ve saf kalbli ağaları göreceğim geldi! … ¶Kıbrıs’ın ukalasını, ulemasını, sulehasını (akıllı, bilgili ve soylularını); ve kendi kendilerini dünyanın en akıllısı, dâhisi addeden zevat-ı kiramı (saygın beyleri) ziyaret etmeye ne kadar heveskârım!” (Fedai, 1986: 185, 188)

As I see it, one of the most pervasive, but least problematised aspects of Cypriot politics, public life and lifeworld is the mental–emotive state of living in a small society, and on a small island—particularly, on the part of the intelligentsia. There have been many people who have just left, feeling torn, emotively and mentally, between the many wonders of the Island and the parochial lives of its inhabitants, and the petty squabbles of its town politics.5 Credit goes to Yael Navaro-Yashin for having brought up this issue, and it is to be hoped that, in Cyprus studies more progress will be made to theoretically link the study of emotive crisis to the those of political and economic crises.

The gist of the issue of the specificity of micro-states, and micro-economies boils down to the question of ‘scale’. It would be interesting to study how small scale affects the relationships between the different sub-ensembles of relationships, particularly, and using the terms of Bob Jessop, those between politics, the public sphere and the lifeworld. The point I have in mind is that, small scale can make it relatively more difficult to assign distinct spaces to

5

Writing this, I have in mind the broken lives of the late Özker Yaşın, poet and novelist, who spent the last years of his life in İstanbul; the late Dr. İhsan Ali, the great anti-nationalist, and pacifist–humanist of the T/Cs, who once said: “We have created a hell out of a paradise”; and his late nephew Özdemir Özgür, the gentle soul I have had the chance of knowing.

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relationally different sub-ensembles, causing the sphere of politics, public sphere and the lifeworld to spatially collapse over one another, and share the same space. If true, this could make some types of power relations more likely than others, and some, completely unlikely. One key cause of this is that small space would compress the communicative sphere as well, making it directly accessible and/or observable. For instance, the idealisation of political leaders is likely to require a considerable physical distancing between leaders and the populace. Thus, speaking of the changes the establishment of the ‘independent’ TRNC has brought along in the dominant discourse, Ali Bizden recalls how the T/Cs now got a whole new flag, a new narrative of the war of independence, and a ‘cult of personality’, as Dr. Fazıl Küçük the leader and hero of the T/Cs war of liberation. However, Bizden also points out that, given the ‘smallness’ of Cyprus, and the ‘freshness’ of the community’s memories could not possibly let this story, this new mode of knowing take root. Dr. Küçük could not, in the minds of T/Cs, take the place of Atatürk so easily. The parents, older sisters and brothers of the TRNC knew Fazıl Küçük as ‘the Doctor’, and their most vivid reminiscences of him were his slurs. ‘Doctor’ was just another of the familiar faces of Çarşı, he was ‘Rahmetli Doktor’ [the late Doctor] (Bizden, 1997: 82–83).

The most popular application of the question of scale is, to the best of my knowledge, the study of the T/C economy as a ‘small-island economy’—to which many T/C economists are particularly attracted. Studying the dynamics of the T/C economy from the perspective of small island

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economies, Mıhçı and Karaman (2005: 22) point out that the origins of the field date back to the late 1950s, when the distinction between small and large economies was firstly made, contributing to the country typologies in the literature of development. Later on, focus upon the so-called small island economies, their basic difference with the small economies in general being their geographical isolatedness. Until the 1980s, the dominant view in the literature was that small island economies faced a number of structural impediments in their growth processes, originating in the scale diseconomies caused by their smallness, which, in turn, led to higher unit costs (Mıhçı and Karaman, 2005: 21). One of the basic arguments concentrated on the impass faced by small island economies in terms of the two basic development strategies. Thus, they could not opt for import substituting industrialisation, because of the insufficiency of their domestic markets. On the other hand, there were serious constraints before export-oriented industrialisation, due to relatively higher costs of transportation and the instability of foreign demand (Mıhçı and Karaman, 2005: 22). One of the interesting findings of the small-island economy studies was that the institution of competitive market structures seems to be very difficult for small islands. The small size of the domestic markes constitutes a natural barrier to the entry of the new firms, thus making monopolistic and oligopolistic structures a distinct possibility for small islands (Mıhçı and Karaman, 2005: 23). As a I matter of fact, I tend to think that this this point is critical to comprehending the G/C and T/C nationalist rivalry in the field of capital accumulation. Thus, in the case where the optimum scale of

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efficiency was close to or roughly equal to the size of the market, there was room for only a few oligopolies or a monopoly. Thus, in the late 1950, the T/C nationalist leadership supported some investment projects to create private monolopolies that would capitalise on the T/C domestic market. Monopolistic profit would both speed up capital accumulation, and the T/C nationalist leadership with new sources of public revenue. Such initiatives were strongly objected by the G/C nationalist leadership on the grounds that they violated economic rationality. Overall, it would not be too farfetched to argue that, in the small island economy of Cyprus, nationalist rivalry in the field of economy was about the ‘scramble’ for monopolistic markets.

It was the British who, during the post-war process of decolonisation, first took the question of small scale seriously, either because they were seriously concerned, or because they were appealed by its political uses, or both. In so doing, they focused, not so much on the scale diseconomies of production plants, but the scale diseconomies of the states. As noted above, the small economy argument is that the size of the domestic market is too small to ensure scale economies for production plants. Similarly, the British administrators argued that the geographical sizes of the so-called ‘small (island) colonies’ were too small to ensure scale economies for independent state apparatuses. Therefore, the best way out for some small colonies was to be ‘satisficed’ with self-government in strictly domestic affairs, and continued dependence upon the British in the areas of defence and foreign relations. Some others could become independent, and ensure scale economies, by means of getting together as a federated state of small

The political economy of state - building: The case of Turkish Cypriots (1960-1967)

THE

POLITICAL ECONOMY OF STATE–BUILDING:

THE

CASE OF TURKISH CYPRIOTS

(1960–1967)

A THESIS SUBMITTED TO

THE GRADUATE SCHOOL OF SOCIAL SCIENCES

OF

İSTANBUL BİLGİ UNIVERSITY

BY

HAKAN ARSLAN

IN PARTIAL FULLFILMENT OF

THE REQUIREMENTS FOR

THE DEGREE OF DOCTOR OF PHILOSOPHY

IN

THE DEPARTMENT OF POLITICAL SCIENCE

February, 2014

İSTANBUL

İSTANBUL BİLGİ UNIVERSITY

FACULTY OF

ECONOMICS AND ADMINISTRATIVE SCIENCES

THE

POLITICAL ECONOMY OF STATE–BUILDING:

THE

CASE OF TURKISH CYPRIOTS

(1960–1967)

HAKAN ARSLAN

February, 2014

İSTANBUL

ABSTRACT

ÖZ

I

L

M

Kemâlettin Savaş

(1953–2013)

ACKNOWLEDGEMENTS

TABLE OF CONTENTS

LIST OF TABLES

ABBREVIATIONS

CHAPTER I

INTRODUCTION