Urban bias policy<\/p>\n
The government's decision to postpone fuel price hikes,
\noriginally planned for this month, highlights the exceptionally
\nlarge political leverage that the minority urban population in
\nthis country has. It is evidence of the strong urban bias in the
\npresent system of political representation and government. It is
\na system in which rural folks, although making up over half of
\nthe population, are not as well represented as they should be.<\/p>\n
This strong urban bias is an aspect of the government's cheap
\noil policies that is rarely discussed objectively as politicians,
\nactivists, students and the media busied themselves opposing the
\nplanned increases. Yet, here is a government program whose
\nbenefit is enjoyed mostly by a small minority of the population,
\nbut whose burden, estimated at Rp 22.4 trillion ($2.9 billion)
\nbetween April and December even with the price increase, is
\nequally borne by everyone in the country.<\/p>\n
The oil subsidy benefits mainly those who travel frequently,
\nincluding owners of private vehicles. The more cars you have and
\nthe more often you drive, the more benefit you reap from the
\nsystem, and the more burden you impose on the rest of society.
\nThe rural population has the benefit of cheap kerosene, their
\nmain cooking fuel. But the biggest beneficiaries of this cheap
\noil policy are people in urban areas, mainly private car owners
\nand to a lesser extent public transportation users.<\/p>\n
Yet, someone must ultimately bear the heavy cost of the
\nsubsidy. It sure is not the International Monetary Fund (IMF) --
\noften depicted as the evil force behind the government's decision
\nto hike fuel prices -- or any other major foreign lender. Even if
\nthe money to pay for this program comes from foreign loans -- a
\nprobable scenario since the government is broke -- it is the
\nentire nation who will have to pay this, sooner or later. Surely
\nthere are much wiser ways of spending the billions of dollars
\nwhich the nation's wealthy squanders each year on oil subsidies.<\/p>\n
A common fallacy found among people who object to the planned
\nfuel price increases is to blame the IMF for putting pressure on
\nthe Indonesian government. Given Indonesia's financial
\npredicament, the government is often portrayed as a weak party
\nwith no option but to accept IMF's terms in return for the
\nmassive bail out program. While the IMF may indeed have required
\nthe government to phase out the fuel subsidies, the program makes
\neconomical sense. It makes better use of Indonesia's precious oil
\nresources, and addresses the rural-urban imbalance. Raising fuel
\nprices is a course that the government must pursue even without
\nthe IMF prodding.<\/p>\n
Consciously or not, politicians, non-governmental
\norganizations, students who took to the streets, and the media
\nare protecting the interests of the wealthy few by speaking out
\nagainst the fuel price hikes. The IMF -- even if we assume they
\nhave dictated the policy -- has actually a greater legitimate
\nclaim that these people do of acting on behalf of the larger
\npopulation who live in the countryside.<\/p>\n
Other instances where urban bias is most apparent is in the
\ngovernment's policy of keeping rice prices cheap to protect urban
\nconsumers. The urban population have also enjoyed far greater
\naccess to government-provided basic facilities, including
\neducation and health, not to mention infrastructures built by
\ntaxpayers money. All of this may be acceptable since the urban
\npopulation is politically better organized and have the advantage
\nof proximity to the centers of power. But this is an unhealthy
\nsituation. If tolerated it will only widen the gap between the
\nurban and rural populations. Whatever the outcome of the current
\ndebate about phasing out oil subsidies, we need to redress the
\nheavy urban bias in our political system.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/urban-bias-policy-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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