Through TÜİK, they have seized 86 percent of pension payments and 66 percent of the minimum wage

With its inflation measurements and announcements, TÜİK is openly usurping the rights of retirees, workers, and civil servants. It is betraying the science of statistics.

TÜİK announced inflation at 1.64 percent for June. It also calculated the six-month inflation rate for the salary adjustments of retirees and civil servants at 24.73 percent. Wherever they found that figure... 

However, ENAG, which consists of independent economists, calculated the six-month inflation rate at 41.16 percent. Since January 2022, I have also created an inflation basket based on my own consumption habits and have been measuring my own inflation. It is neck-and-neck with ENAG. The inflation I found for the first six months of this year is 43.27 percent... Therefore, I reject the calculations of TÜİK and the Istanbul Chamber of Commerce, and I accept ENAG's calculation as accurate and realistic.

In July, they will give retirees a 24.73 percent six-month inflation adjustment. The lowest pension will increase from 10,000 liras to 12,473 liras. However, according to ENAG, it should have been 14,116 liras. Through deliberately erroneous measurements, TÜİK has acted as an intermediary in the evaporation of 1,643 liras from the retirees' salary adjustments (14,116 - 12,473). 

If you ask, "Is that a lot?"... If we only look at the 6 months, I would say, "No, it is little this time." They are seizing 12 percent of the pension in six months. Yet, in the last four years, they have usurped 86 percent of pension payments. That is why I insist on discussing this not just based on this year, but based on the last 4 years, and I say that those responsible for the last 4 years must be held accountable.

We can calculate how much of the pension and minimum wage has been eroded by the inflation incorrectly measured by TÜİK during the AKP era using various methods. However, we do not know how reliable TÜİK data has been over the last 22 years. Therefore, I calculated the period from 2020, when ENAG began measuring inflation, to the present. Let me share how much of the minimum wage and pensions have been evaporated (stolen) in the 4 years between January 1, 2020, and December 31, 2023, according to the inflation difference between the two institutions. To ensure those who are not good with math do not get bored and stop reading, I will provide the details of the calculation at the end of the article.

If real inflation data had been taken into account over the last 4 years, the minimum wage today would not be 17,000 liras, but 49,473 liras. Whether you call it evaporation or theft, they have seized 66 percent of the minimum wage in the last 4 years.

As for the worker retiree... I cannot make a single calculation here. When the AKP came to power, the lowest worker pension was 40 percent higher than the minimum wage. Now it has dropped to 60 percent of it. In this case, let's make the calculation with three possibilities.

If real inflation data had been taken into account over the last 4 years, the current 10,000 lira pension should have been 32,000 lira at the beginning of 2024. They are currently receiving 31 percent of what they should be getting. 69 percent of their salaries have vanished. If the first six months of 2024 are also taken into account, the lowest pension that should have been paid with the July adjustment would not be 12,473 TL, but 45,171 lira. They have seized 72 percent of pension salaries and transferred them to cronies and the palace's expenses. 

If the pension had been equal to the minimum wage, it would not be 10,000 lira, but 49,473 lira. According to this calculation, it turns out they have seized 80 percent of the pension.

If the ratio between pensions and the minimum wage had not changed, and the lowest pension had been 40 percent higher than the minimum wage, it would not be 10,000 lira, but 69,212 lira. According to this calculation, they have seized 86 percent of the pensioner's salary. 

In summary, as a result of TUIK's deliberately incorrect calculations, they have seized 66 percent of the minimum wage and 86 percent of the pension. I do not know whether you would call this act inflation measurement, evaporation, extortion, or theft. The interpretation is left to the reader. 

WOULD THE STATE AND PRIVATE SECTOR GO BANKRUPT IF SALARIES WERE LIKE THIS?

If the minimum wage were 17,000 lira and the lowest pension were 49,000 lira instead of 10,000 lira, would the private sector go bankrupt, or would the state go insolvent? Is 49,000 lira too much?

No, it is not. The private sector would not go bankrupt. The state would not go under either. The level of minimum wage and pension we are using as a baseline here is January 2020. In January 2020, neither minimum wage earners nor pensioners were satisfied with their situation. Were companies and the state going bankrupt in 2020 that they would go bankrupt now if wages and pensions returned to their real January 2020 levels?

These data are a very clear indicator of how much workers and pensioners in Turkey have been exploited and pushed into misery over the last 4 years. However, despite such great misery, there is no very serious change in the political landscape of the country. In my opinion, in the face of this picture, the CHP becoming the leading party in the local elections does not seem like a sufficient and significant indicator. The total votes of the AKP and MHP are still higher than the votes of the CHP... Sociologists and political scientists need to analyze this rapid, sharp, and massive impoverishment well.

This disaster of distribution in the economy, I believe, shows that the theory of “Keep them hungry so they obey, keep them ignorant so they submit” is still valid. There is a need for a new and renewed political discourse and action.

THIS INFLATION WILL NOT FALL

The fire in the markets and bazaars continues at full speed. However, they are blatantly spreading misleading propaganda, saying,“Our program is working. Inflation has started to fall. We will see significant drops in inflation in July and August; we will go from 70 percent annually to 50 percent annually. That is when the welfare level of the worker, the retiree, and the low-income earner will increase.” 

I have written about this twice before. They are acting with the cunning of a fox. You may have heard of the concept of base effect in inflation. Inflation, which was 9.49 percent and 9.09 percent in July and August of last year, will not increase as much this year. When these high rates are removed from the annual calculation and the rates that TÜİK will find on demand are entered, it will be announced that inflation has fallen to 50 percent.

By the end of August, inflation will fall from 70 percent to 50 percent according to TÜİK, and to a level between 95-99 percent according to my estimate of ENAG inflation, which is 113 percent. 

So, will the welfare of retirees, workers, and low-income earners increase when inflation drops to 50 percent, as the President, Şimşek, the Central Bank, and government supporters claim? 

No, that will not happen. 

When inflation falls, prices will not decrease. Minced meat increased by 100 percent from 300 liras to 600 liras. Now, the price of minced meat will not drop below 600 liras. On the contrary, it will increase by 50 percent and rise from 600 liras to 900 liras. Will the income of retirees and minimum wage earners increase above this? 

I always give the same example. We are walking at a speed of 5 kilometers per hour. Prices, however, are rising at the speed of a car passing us at 120 kilometers per hour. The car is reducing its speed to 80 kilometers per hour, but we are still walking at 5 kilometers per hour. And the prosperity that is said to increase with the drop in inflation is inside that car. By the way, when and how will we reach that prosperity?

THE LAST 4 YEARS OF INFLATION, MINIMUM WAGE, AND PENSION CALCULATION...

For those curious about the calculation I made above, here are the details... I wrote about this in 12 Punto on March 24. I am summarizing and conveying it from there.  

In January 2020, the minimum wage was 2,325 TL, and the lowest worker pension was 1,500 TL. For the increases that should have occurred when transitioning from the end of 2023 to 2024, I based my calculations on the 58 percent revaluation rate applied by the state to taxes, fees, and fines for 2024. The inflation of the last 4 years is as follows: 

YEARS ENAG TÜİK 

2020 36.7 14.6

2021 82.8 36.1

2022 137.5 64.3

2023 127.2 64.8

Over the last 4 years, inflation according to TÜİK is 322 percent, while according to ENAG it is 1250 percent. (For total inflation, one does not add, one multiplies.)

 In January 2020, the minimum wage was 2,325 TL. By the end of 2023, according to TÜİK inflation, the minimum wage should have been 9,819 TL. Amid slogans of 'we did not let the worker be crushed,' they set it at 11,402 TL. (2325x1.146x1.361x1.643x1.648= 9819). For 2024, the revaluation rate was 58.46 percent. According to TÜİK, the minimum wage for 2024 should have been 18,067 TL. It remained at 17,000 TL.

If we perform the same calculation using ENAG inflation, (2325x1.367x1.828x2.375x2.272 = 31,391), the 11,402 TL minimum wage at the end of 2023 should have been 31,391 TL, and for 2024, it should have been increased by the revaluation rate to 49,743 TL. 17,002/49,743 = 0.34... They are providing only 34 percent of what the minimum wage should be; they have seized 66 percent of it. 

As for the retirees... The lowest pension at the beginning of 2020 was 1,500 liras...

 1500x1.367x1.828x2.375x2.272 = 20,225 TL. By the end of December 2023, the lowest pension should have been 20,225 liras. However, they set it at 7,500 TL. If 20,225 liras had also increased by the 58.46 percent revaluation rate for 2024, it would have been 32,048 liras at the beginning of 2024. Yet, they set it at 10,000 liras. 10,000/32,000 = 31 percent of what it should be... In other words, they seized 69 percent of the pension over four years. 

If the lowest pension were equal to the minimum wage... In that case, 10,000/49,743 = 0.20... The pension is only 20 percent of what it should be. 80 percent is gone. 

If the lowest pension had continued to be 40 percent higher than the minimum wage, it would have been 69,640 liras, not 10,000 liras. 10,000/69,640 = 0.14... The lowest worker pension is only 14 percent of what it should be. They evaporated 86 percent of it.