The immediate effects of Treasury moves to freeze any US-based assets belonging to Interior Minister Suleyman Soylu and Justice Minister Abdulhamit Gul and “generally prohibiting US persons from engaging in transactions with them” was to push the ailing Turkish lira to record lows against the dollar. Experts maintain the pair are the most senior officials sanctioned so far under the Global Magnitsky Act of 2016 punishing human rights abuse and corruption.

While some Turkish analysts played down the move as “symbolic” and “Trumpian” — in other words, particular to the erratic foreign policy coming out of the White House — it's unprecedented between NATO allies.

“Given the fragile state of both the US-Turkish relationship and the Turkish economy, the consequences of this crisis could be dramatic,” observed Nicholas Danforth, a senior analyst for the Bipartisan Policy Center who specializes in Turkish affairs. Danforth told Al-Monitor, "Both Washington and Ankara appear to have elevated Brunson’s case to a matter of national prestige, making it hard for either side to back down. The United States has the power to do considerable damage to Turkey’s economy if it wants, and Erdogan, for his part, has the power to resist, whether all of his citizens want to endure the consequences or not.”

If the defiant noises coming out of Ankara, including vows of counter-sanctions against US officials, are to be taken at face value, Turkey will not release Brunson anytime soon, and this may in turn trigger further US sanctions against other Turkish officials and entities, potentially trapping the sides in an escalating spiral.

The fact that the Treasury's move refers exclusively to Brunson, who has been held since October 2016 on specious espionage and terrorism charges, will have only reinforced Erdogan’s story that Brunson works for the CIA, tweeted Kori Schake, deputy director of the International Institute for Strategic Studies in London. She pointed out how suspicious it is "that we go so far for him yet no effort for arrested Turkish nationals working at US Embassy" and added that it "also looks like US only cares about Christians.”

The immediate trigger for the US action was Turkey’s refusal to free Brunson even after the administration, according to sources quoted by Bloomberg, rolled over for Turkey after protracted bargaining. Concessions reportedly included lowering an anticipated multibillion-dollar fine on Turkish state lender Halkbank for evading sanctions on Iran, extraditing convicted Halkbank executive Mehmet Hakan Atilla to serve the remainder of his sentence back home and securing the repatriation from Israel of another Turkish national, Ebru Ozkan, accused of links to Hamas in exchange for Brunson.

Ozkan was freed and allowed to fly back to Turkey on July 16. Brunson wasn’t after his third courtroom hearing July 18. Then all hell broke loose with President Donald Trump threatening “large sanctions” against Turkey on July 26, a day after Brunson was transferred from his prison cell in the western province of Izmir to house arrest.

Bloomberg reported the deal collapsed when Turkey demanded that the investigation against Halkbank be dropped. It remains unclear from the report whether Turkey wanted the Halkbank fine under negotiation to be scrapped altogether or was seeking guarantees that there would be no further investigation leading to further potential arrests or fining of Turkish citizens and entities.

In any case, “This is a very serious crisis because of the political background. That is, a Turkey drifting away from the West and an US policy machine, including public opinion and Congress, that is increasingly mad at Turkey,” said Asli Aydintasbas, a senior fellow at the European Council for Foreign Relations and a columnist for the Turkish opposition newspaper Cumhuriyet. The tension points are multiple and messy, including the United States' ongoing support for Syrian Kurdish militants Turkey views as an existential threat and more recently Ankara’s refusal to comply with US sanctions against Iran.

Aydintasbas told Al-Monitor, “Turkey’s biggest champion in DC had been Trump. Now with repeated requests for Brunson’s release turned down, Trump may no longer have the appetite to defend Turkey when it come to issues like NATO, Syrian Kurds and [Turkey’s planned acquisition of Russian made] S-400 [missiles].”

Like many others, Aydintasbas believes that the only way for a climbdown would be Brunson’s release, which could conceivably occur following his fourth courtroom hearing Oct. 12. It would allow both Congress and the administration to put the brakes on a set of proposed sanctions, including halting the sales of F-35 fighter jets and blocking financing to Turkey from the lending arms of global financial institutions such as the World Bank.

Indeed, according to Danforth, “If Turkey responds with reciprocal but largely meaningless measures like sanctioning US Cabinet officials and Washington takes these measures in stride rather than escalating further, it would at least leave open the possibility for level-headed diplomacy to arrange a face-saving outcome down the road.”

In a hopeful sign — and in stark contrast with fellow officials — Economy Minister Berat Albayrak struck a conciliatory tone when he referred to "the strong historical past and alliance" between Turkey and the United States in Aug. 2 remarks carried by the pro-government Sabah newspaper. Albayrak, who is Erdogan's son-in-law and chief lieutenant, termed US sanctions "unacceptable" but shrugged off their impact on the economy. He asserted, however, "Our priority is to [resolve the crisis] through diplomacy and constructive efforts."

But matters have been further complicated by demands from Erdogan’s right-wing nationalist ally Devlet Bahceli that Brunson be exchanged solely for Fethullah Gulen. The Pennsylvania-based Sunni imam is accused of plotting the July 2016 attempt to violently overthrow Erdogan and Turkey has been pressing for his extradition ever since. And Trump’s perceived zigzagging on North Korea and Iran might just lull Ankara into the sort of complacency that helped pave the way to the existing impasse.

Still, predictions that the next step will be Turkey’s expulsion from NATO are plainly exaggerated. With its strategic location at the intersection of conflicts, energy corridors and sea lanes all vital to Western security, it seems highly unlikely. Amanda Sloat, a senior fellow at the Brookings Institution and a former deputy assistant secretary at the State Department who covered Turkey, told Al-Monitor, “I don’t think the current bilateral crisis affects Turkey’s NATO membership.” Still, “There is concern within NATO about Turkey’s planned purchase of a Russian missile defense system which is not inter-operable with Alliance systems and raises questions about Turkey’s strategic orientation.”

Amberin Zaman is a columnist for Al-Monitor's Turkey Pulse who has covered Turkey, the Kurds and Armenia for The Washington Post, The Daily Telegraph, The Los Angeles Times and the Voice of America. She served as The Economist's Turkey correspondent between 1999 and 2016. She was a columnist for the liberal daily Taraf and the mainstream daily Haberturk before switching to the independent Turkish online news portal Diken in 2015.

Al-Monitor

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