There was a time when Istanbul was one of the safest cities in the world, because people were afraid of the police. People are no longer as afraid of the police as they used to be. Mugging used to be almost unknown; now everybody is afraid of mugging. In that sense, the downside of liberalization is already being felt in Turkey. And of course some people are afraid of Kurdish ethno-terrorism, which worries Turks very much more than the religious sort.

Turkey's relations with its immediate neighbors are improving. They were pretty bad for a long time - with Syria they were abominable, and with Iran they were pretty bad. In both cases Turkey sees potential for trade, especially with Iran, where it gets a lot of natural gas. In good times Iran and Turkey find mutually profitable objects of exchange, but with Syria things have been very bad; Syria doesn't have much money and never will.

Historically Turkey hasn't had much success in attracting foreign investment. Slowly that is changing. There's a tradition of arbitrary decisions by government ministers and senior civil servants, which would ruin businesses from one day to the next, and which has tended to deter foreign investment. That's changing, and convergence with E.U. practices is a good thing in that it improves governance.

Most Turkish Kurds want a quiet life and improved economic conditions. But the Kurdish regions of Turkey are mountainous; they're ill-favored climatically; they're poor; and there's a limit to what the government can do there without wasting a lot of resources. Developing the south east may mean decamping a large part of its population. But the thing that will improve the lot of the Kurds more than anything else will be the stabilization of Iraq in the first place, because then the Turkish southeast stops being a dead end. It can become a bridge, with trade flowing in both directions.

Turkey, as an ex-imperial power, is all in favor of empires guaranteeing law and order on its borders. Turkey's and America's basic interests with regard to Iraq are identical. They both want a stable and rational Iraq that would use its considerable oil wealth in order to improve its own lot. But there doesn't seem to be very much prospect of that at the moment.

There was a time when Istanbul was one of the safest cities in the world, because people were afraid of the police. People are no longer as afraid of the police as they used to be. Mugging used to be almost unknown; now everybody is afraid of mugging. In that sense, the downside of liberalization is already being felt in Turkey. And of course some people are afraid of Kurdish ethno-terrorism, which worries Turks very much more than the religious sort.

Turkey has had a customs union with Europe since 1996, and there's free trade in everything other than farm products and services. And Turkey has shown that it can compete. It's good at making cheap goods - household appliances, food, detergents, cheap clothes. And they make a lot of white goods, cheap TVs, washing machines, electric appliances, steel, and, recently, auto parts. And Turks are gradually moving into IT.