Military-backed New Order still reigns<\/p>\n
By Olle Tornquist<\/p>\n
This article is based on a paper presented at an international
\nseminar, Toward Structural Reforms for Democratization in
\nIndonesia, held in Jakarta from Aug. 12 to Aug. 14. The seminar
\nwas organized by the Indonesian Institute of Sciences and the
\nFord Foundation. This is the first of two articles.<\/p>\n
JAKARTA: Soeharto is gone. His New Order regime remains. But
\nit is undermined and disintegrating. Its perfidious survivors try
\nto relegitimate their wealth and positions. Its anti-Communist
\nsupporters from the mid-1960s, who turned middle-class dissidents
\nin the 1970s, try to recover their losses. Its less compromising
\nyounger critics (and principled intellectuals) try to recover
\ntheir losses.<\/p>\n
And its less compromising younger critics (and principled
\nintellectuals) try contradictory ways of promoting a fresh start.
\nSo while common people suffer, various factions of the elite
\nquarrel, and the market and the West hesitates. It is time to ask
\nwhy it all happened, and what chances there are for a more human
\norder. What is the Indonesian lesson?<\/p>\n
The thesis in vogue is that the Indonesian problem was about
\ntoo much politics and too much state, too many regulations and
\ntoo little market. While the dissidents could not beat the
\nregime, and others could not resist its patronage, it was only
\nthe market and the International Monetary Fund (IMF) that finally
\nstood up against the dragon, brought down Soeharto and created an
\nopening for democracy. Now there must be privatization and
\nderegulation and the opening up for foreign companies.<\/p>\n
These, of course, are but ideological half-truths. A critical
\nanalysis indicates instead that the actions of the market and its
\nsupporters were politically disastrous, contributed to a
\nsocioeconomic catastrophe, obstructed democratization and only
\naccidentally helped do away with Soeharto.<\/p>\n
To begin with, the economic crisis did not result from
\nexcessive regulations but from bad regulations, and from too
\nlittle popular influence. Bad regulations that were exploited by
\nspecial interests with the state, business and international
\nfinance, and too little popular influence capable of holding such
\nspecial interests in check. As elsewhere in East Asia, the
\nserious problems did not develop until private interests became
\nstronger and deregulation increased. Then the regime was unable
\nto coordinate the new groupings and could only hold down
\ndiscontent among the new middle and working classes.<\/p>\n
Further, once the Indonesian crisis had erupted during July
\nand August, conventional economic measures did not work. Many
\nobservers began to realize, therefore, that the basic problem was
\npolitical rather than economic. Critical analyses of the mid-1996
\nousting of Megawati, riots and the crackdown on the democracy-
\nmovement were no longer ignored. Critical analysis concluding
\nthat dissidents were too poorly organized to make a difference
\nyet had to be supported since the regime was totally unable to
\nregulate conflicts, reform itself and prepare an "orderly"
\nsuccession.<\/p>\n
But even though it became increasingly apparent that the
\ncrisis could only be solved through fundamental political
\nchanges, little was done to support rapid development of the only
\nalternative -- the democracy movement and the moderate
\nreformists. Soeharto's monopolies were no longer appreciated, but
\ntemporary stability was.<\/p>\n
"If you were only able to give us an alternative," the West
\nderogatorily told democracy activists who faced an uphill battle
\nafter decades of repression and "floating mass" politics.<\/p>\n
Worse, the West itself had actually been contributing to those
\ndifficulties of generating an alternative. Much of Sukarno's
\nauthoritarian nationalism in the late 1950s was because the Dutch
\nrefused to give up their colonial interests, the CIA supported
\nseparatist movements and the West wanted to prevent the
\ncommunists and their unique modern interest-based mass movements
\nfrom wining liberal democratic elections. Then Western powers
\npaved the way for the military takeover and the massacres in 1965
\nand 1966.<\/p>\n
Their favorite liberal and so-called socialist administrators
\ndid not have a strong enough social and economic base to make a
\ndifference, so the United States in particular turned to the army
\ninstead.<\/p>\n
According to the conventional Cold War wisdom of the West (and
\nprofessor Huntington's then forthcoming "politics of order"
\ntheory), the army would serve in policing and containing the
\nmasses, thereby allowing liberal middle class experts to run the
\ncountry. But as we know, once the left had been massacred, and
\nmany others jailed, harassed and domesticated, it was rather the
\narmy generals who took over, with the middle-class experts as
\ntheir servants.<\/p>\n
And yet the repression, corruption and nepotism that followed
\nwere also sustained by political and extensive economic support
\nfrom the West, including loans issued on the basis of political
\nguarantees rather than on well-founded economic evaluations.
\nNeither the International Monetary Fund and partners nor various
\ncorporate leaders had anything decisively negative to say about
\nSoeharto's Indonesia until hours before the crisis broke out. On
\nthe contrary, Indonesia was on the World Bank's top 10 list of
\npromising emerging economies.<\/p>\n
Moreover, as the Indonesian crisis evolved from September 1997
\nonwards, the West not only abstained from betting on democrats
\nand moderate reformists to tackle the basic political problems
\nbut instead referred the matter to neo-classical IMF economists.
\nFrom October onward their narrow-minded recipes diminished
\nconfidence in Indonesia's ability to avoid an economic breakdown
\n(Officials in the IMF and the World Bank later admitted this
\nthemselves).<\/p>\n
The situation deteriorated. Soeharto had to look for
\nalternatives, but also to create additional problems by
\nnominating a vice president whom nobody would prefer to himself,
\nHabibie. By January 1998 the currency fell beyond imagination,
\nthe economy came to a standstill, people began to protest, anti-
\nChinese riots spread and the regime was on the brink of collapse.
\nAccording to the World Bank, no country has suffered a similarly
\nharsh economic backlash since World War II.<\/p>\n
In fact, however, the economic backlash was like the U.S.
\nbombing of Baghdad during the Gulf War. Soeharto was as able to
\nturn the negative into a positive, putting the blame on the
\nChinese business community and the West's free-market recipes, as
\nit was difficult for the West to find an alternative to his
\nauthority and his politics. He was reappointed president in March
\nand formed a provocative kind of combat government with his
\ndaughter Siti "Tutut" Hardijanti Rukmana as de facto prime
\nminister and an absolute majority of family friends and loyalists
\nin other posts.<\/p>\n
The writer is professor of politics and development at the
\nUniversity of Oslo.<\/p>",
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