That aside, I do feel that Islam can be made a power for moderatism. It was just badly ignored until it was too late.
Actually, Ataturk wanted a secular state. He outlawed many aspects of Islam, including wearing the veil and such. His reasoning that he needed Turkey to be secular in order to survive the coming century.
In fact, Ataturk was a Muslim privately, but very much anti-Islamic politically. He wanted to remove Turkey as far away as possible from the old Ottoman Empire.
Turkey under Kemal Ataturk was the only Muslim country which was genuinely secular and progressive. Turkey under AKP appears to be moving away from this path
Except that Kemal's secularism was over the top and enforced in authoritarian way. This was perhaps a greater factor behind modern Islamic atavism then even western imperialism, especially since this model spread to other parts of Islamic world, including Egypt and Iran. Look at where they are now.
That's the thing with Kemalism : it provided a model attractive to leaders and palatable to people everywhere: benevolent dictatorship. All the benefits of fascism without the negatives... except lack of democratic development is always a negative.
How many times have we heard people say "Ataturk was a dictator because he had to be." Why did he have to be? He thought he knew what was best, and imposed it from above, like a good Ottoman.
He's admired because he defeated the colonial powers and "turned the face of Turkey away from the barbarism of the east toward the True Light of European civilization." But his accomplishment against the imperial powers was military, not political, and his "transformation" of society was too rapid, and therefore shallow, bottling up forces that have come back to bite everyone on the ass.
What he should have done was democratize, and that would have defeated the reactionary forces that he opposed. Ironically, it was his followers that devolved over time into reactionaries. The Ottoman Empire before him was more liberal. Abdul Hamid II, while froze democracy at the center, developed it on the local level, something that Kemal (and also the Europeans over their mandates) later reversed.
Secularism should be lack of state support for any one religion, not the oppression of religious practice. By doing the latter, the Kemalists gave Islamists political impetus. What would be the point of Erdogan's party if the majority of the population didn't feel alienated by the Kemalist elite?
Basically, Kemalism had bared a consequence exactly the opposite of what it was intended for. Islam was reforming, but it was halted under Kemalism, and now modernism means you should stop being muslim. And even after Ottoman Empire, Turkey didn't just cease to be role model for muslim world over night, and this model was copied elsewhere in the muslim world, soldifying antagonization between Islam and progressivism like never before.