This morning, Turkish police surrounded protesters in Taksim Gezi park, the central square in Istanbul, blocked all exits and attacked them with chemical sprays and teargas.

An Occupy-style movement has taken off in Istanbul. The ostensible issue of conflict is modest. Protesters started gathering in the park on 27 May, to oppose its demolition as part of a redevelopment plan. But this is more than an environmental protest. It has become a lightning conductor for all the grievances accumulated against the government.

Police have waited until the early hours of each morning to attack, just as police in the US did when dealing with Occupy protesters. They set fire to the tents in which protesters were sleeping and showered them with pepper spray and teargas. A student had to undergo surgery after injuries to his genitals.

The occupiers adapted and started to wear homemade gas masks. More importantly, they called for solidarity. In response to yesterday's assault, thousands of protesters turned up, including opposition politicians. But this morning's attack allowed no defence or escape. The park, and the area around it, is still closed, and still under clouds of gas.

In April, a Justice and Development party (AKP) leader warned that the liberals who had supported them in the last decade would no longer do so. This was as good a sign as any that the repression would increase, as the neoliberal Islamist party forced through its modernisation agenda.

The AKP represents a peculiar type of conservative populism. Its bedrock, enriched immensely in the last decade, is the conservative Muslim bourgeoisie that first emerged as a result of Turgut Özal's economic policies in the 1980s. But, while denying it is a religious party, it has used the politics of piety to gain a popular base and to strengthen the urban rightwing.

It has spent more than a decade in government building up its authority. The privatisation process has led to accelerated inequality, accompanied by repression. But it has also attracted floods of international investment, leading to growth rates of close to 5% a year. This has enabled the regime to pay off the last of its IMF loans, so that it was even in a position to offer the IMF $5bn to help with the Eurozone crisis in 2012.

In the meantime, the AKP has gradually consolidated its support within the state apparatus and media, and no longer needs its liberal backers. The Turkish military leadership has been compelled to accept the Islamists, having suffered a significant loss of power relative to other branches of the state such as the police and judiciary. While the erosion of the military's power should be a gain for democracy, journalists have also ended up in jail on charges of plotting coup d'etats.

Of course, there is a history of coup plotting. And the government charged 86 people with plotting to bring down the government in 2008, as part of its investigation into the Turkish "deep state". But it has been able to use this fear to conflate all opposition with anti-democratic instigation, and crush it ruthlessly. During this time, its vote has risen from 34.28% to 49.90%.

It has also demonstrated confidence in the way it has attempted to deal with the Kurdish question, and in its regional strategy. The government embarked on significant new negotiations with the Kurdish Workers party (PKK) in 2009, partly because it wants to forge a lucrative relationship with the Kurdish regional government in Iraq.

Under the AKP, Turkey has been increasing its relative autonomy from traditional supporters in the White House and Tel Aviv, forging close relations with Iran, Hezbollah and even – until recently – President Assad of Syria. This has been interpreted, hysterically, as "neo-Ottomanism". It is simply an assertion of Turkey's new power.

Thus strengthened, the government is on the offensive. It has never needed the left or the labour movement, which it has repressed. It no longer needs the liberals, as its attacks on women's reproductive rights, and its imposition of alcohol-free zones, show.

This is the context in which a struggle over a small park in a congested city centre has become an emergency for the regime, and the basis for a potential Turkish spring.