Disentangling confusions about federalism

Disentangling confusions about federalism

By Hans Antlov

JAKARTA (JP): At a seminar a few weeks ago, one of the
participants -- a noted member of the House of Representatives --
said the Republic of Indonesia would need to be dismantled if the
unitary nation were to become a federation.

Earlier this year, a leading political figure asked whether,
in a federated system, a person living in Java would need a
passport to go to Maluku. These are just two common
misunderstandings about federalism. There are different kinds of
misinterpretations of what constitutes a federal state and what
kinds of benefits it might bring. Some of these statements
reflect a lack of knowledge, while others perhaps indicate fear
of constitutional change. It would therefore seem important to
disentangle the confusion about federalism.

The unitary principle grounds sovereignty in the nation as a
whole. A government representing a unitary nation has the right
to delegate powers downward to regional and local institutions,
through legislation, but the regions have no right to any of
these powers. A unitary state can be highly centralized (like
France), or it can be decentralized with a substantial degree of
autonomy for provinces or communes (like Britain or the
Netherlands). Regardless of the degree of decentralization, it
remains a unitary state. The powers held by local and regional
organs have been received from above, and can in principle be
withdrawn through new central legislation, without any need for
consent from the districts or provinces concerned. In practice,
however, it may be difficult to recentralize a decentralized,
unitary state.

The federal principle divides sovereignty between the
constituent states and the federation as a whole. The
constitution takes the form of a treaty between a certain number
of states which defines the division of powers between the states
and the federal level. Importantly, constitutional changes cannot
be made unilaterally by the federal government, but have to be
accepted by the states. The principle behind a federal
constitution is that each state delegates a certain amount of
power upward, to the federal government.

In a loose federation (generally termed "confederation") the
constituent states may have the right to withdraw the powers they
have delegated upwards and resume complete independence.

In a tighter federation this cannot be done unilaterally, but
has to be negotiated and accepted by all parties concerned. In
confederations, the powers delegated upward are also generally
limited (typically defense and foreign policy), while in tightly
knit federations, the powers of the federal government can
sometimes be even more substantial than in a decentralized
unitary state.

According to the Norwegian political scientist Xyvind Xsterud,
the difference between a unitary and a federal state is not that
one is more decentralized than the other, but that the former is
decentralized through legislation whereas the latter is
decentralized by constitution. In a federation, certain matters
are thus constitutionally devolved to local units, and the
central government cannot unilaterally revoke this
decentralization, as it can in a unitary state.

If Indonesia were a federal state, like it was during a brief
period between 1949 and 1950, only one paragraph of the
Constitution of 1945 would need to be changed: "The Indonesian
State is a unitary state in the form of a Republic." This is
paragraph 1, and the word "unitary state" would need to be
replaced with "a federation of states," or something similar.
Presumably a constituent assembly would have to meet, with
representatives from each of the federated states (formerly
provinces), in order to adopt, or reconfirm the revised
constitution.

For all practical purposes, Indonesia could remain the same
nation, with a joint flag and national anthem, one citizenship,
and a single currency and military defense. It would not need to
change its name, although it could become the Federal Republic of
Indonesia or the United States of Indonesia, if this were seen as
desirable. Citizens would certainly not need passports or visas
to travel between the states. It is many years since it was
necessary to have passports in order to travel within such
federal states as India, Malaysia, Australia, Canada, the U.S.,
or Germany.

The difference between a unitary and a federal state is more
subtle. Did anyone notice that Belgium or South Africa a few
years ago gave up their unitary status in order to become
federations? And do we think it strange that sovereign nations in
Europe are willing to delegate some of their powers to the
Council of Ministers and the Parliament of the European Union?

In order for Indonesia to become a federation, two steps are
necessary. First, the constituent state would need to be formed
and to recognize each other. The highest legislative and
constitutive bodies in Indonesia would allow provinces or sets of
provinces to have their own autonomy and to form new states, with
their own rights and duties, independent of (but in cooperation
with) the central government. Each new state would need to
convene a constituent assembly to decide whether or not it would
join the federation and under what conditions. This could be done
without dissolving the Republic of Indonesia.

Simultaneously, the relationship between the central (or
federal) government in Jakarta and the states would need to be
worked out in the form of a treaty. Legally, this could be done
through an amendment to the 1945 Constitution. There would need
to be negotiations between the states and the federal government
concerning the division of powers, defining the limits of
regional autonomy and the powers of the federal government.

In the Indonesian case, there would be a number of thorny
issues, such as the need to divide Java into several states (no
other federation, to my knowledge, has 65 percent of its
population in one state), the geographical imbalance of
resources, and the lack of a coherent identity within larger
units outside of Java (for instance, how many Sikka people in
Flores actually feel themselves to be "Nusatenggarese" or
"Eastern Indonesians"?).

But let us imagine for a moment that these issues were solved
and that the Republic of Indonesia became a federation of states.
Would this mean that the nation would overnight become more
democratic or more decentralized?

No, not necessarily. The second frequent misconception about
federalism, this time heard from its champions, is that it would
cure most if not all of Indonesia's social, economic and
political ills. Such is not the case. We need here to make
careful distinctions along three dimensions: federal vs. unitary;
decentralized vs. centralized; and democratic vs. authoritarian.

A federal state is not always more decentralized and
democratic than a unitary state. Sweden, for example, is a
unitary monarchy -- but with a very high degree of
decentralization and local democracy. Several of the former
communist states in Eastern Europe (including Yugoslavia and the
Soviet Union) were (and remain) authoritarian and centralized
federations. Federations can be more or less decentralized and
democratic; so can unitary states. It depends on politics, and
how words are used to denote various political ideas.

What most commentators mean when they talk about federalism in
Indonesia is, in fact, regional autonomy and local democracy.
These could both be achieved without turning the unitary state
into a federation. Both regional autonomy and democracy could be
accommodated within a unitary state. The newly approved Law on
Local Governments provides the legal framework for far-reaching
autonomy for districts and municipalities.

In fact, together with the Law on the People's Consultative
Assembly (MPR), House of Representatives (DPR) and Provincial
House of Representatives (DPRD), it provides the foundation for a
total renegotiation of the balance of power between the center
and the regions. With empowered local legislatures and regional
autonomy, a unitary Indonesia could open up for a more
participatory democracy. But this cannot be done without vigilant
public opinion demanding that the local regional government is
accountable, and builds on a widespread conviction that DPRD
members are representatives of the people, not of the state.

Democratization can be obtained both within a federation and a
unitary state. It is here that people's energies and enthusiasm
are needed. A federation is thus not an end in itself. It is a
means that could be used to achieve certain ends, such as a
fairer division of revenue or increased political participation
on the local level, but it could also be used for less laudable
goals, such as to allow resource-rich localities to keep their
riches to themselves.

The transformation process could also stir up emotions
preventing an orderly result. It is an intriguing fact that out
of the world's 10 largest democracies, nine are federations (the
exception is Japan). There might thus be something inherent to
federal systems that allows for more democratic participation,
and thus would be worthwhile for Indonesia to consider. On the
other hand, there are risks such as strengthening undemocratic
local power-holders through access to more revenue with less
central supervision.

The current public debate on the future form of the
Indonesian nation must be continued. Whatever form the nation-
state takes, the important issues to be looked at are people's
participation, good governance and local autonomy.

Just as in 1945, Indonesia today has a rare and historic
opportunity to transform the government to meet the challenges of
the future. This is a country of potentially enormous social
change and entrepreneurship. We are witnessing a flowering of new
ideas and social actors, as Indonesia seeks to become a
democratic nation with a more just division of powers and
resources between center and regions, and between state and
citizens.

The writer is a program officer at the Ford Foundation in
Jakarta, and is responsible for a program on participatory local
governance.