Experts call for govt intervention to realize ideals

Experts call for govt intervention to realize ideals

JAKARTA (JP): The undertaking to establish a more democratic
economy calls for more government intervention in guaranteeing a
fairer distribution of income, assets and access for all, a
seminar concluded yesterday.

Speakers at a seminar held by the National Resilience
Institute (Lemhannas) agreed the 1945 Constitution set the
platform for realizing the ideals of a democratic economic
system.

Dorodjatun Kuntjoro-Jakti, dean of the School of Economics of
University of Indonesia, said a set of world-wide acclaimed
instruments would be helpful in transforming the ideals into
daily behaviors.

"Fairer distribution of income, assets and opportunities or
access should be applied in a nation searching for a democratic
economic system, regardless its historical or cultural
background," Dorodjatun said.

He said the government's fiscal and tax policies, which
included progressive and after-sales taxes, have become
taken-for-granted instruments for making a fair distribution of
income.

As for the distribution of assets, Dorodjatun suggested a
transfer of wealth by imposing taxes on people who were lucky
enough to inherit belongings. Japan, for example, stipulates that
40 percent of the value of an inheritance goes into the
government's coffers, Dorodjatun said.

Access deals more with having the opportunity to get a job and
run a business, which Dorodjatun characterized as the absence of
trusts and discriminative treatment in career promotion.

A good example, Dorodjatun said, was the US$700,000 fine
recently imposed on an American bank for denying its colored
employees promotion to managerial level.

"We do nothing wrong if we learn from foreign patterns, even
the American liberal capitalism which is a considered villain in
the light of (state ideology) Pancasila," Dorodjatun said.

"Americans at least are consistent in fulfilling promises
stated in their economic idealism," he said.

Dorodjatun warned that failure to transform idealism into
behavior would lead Indonesia into a crisis of credibility while
it was bracing itself for a free market in the 21st century.

"I'm afraid that from an historical point of view Indonesia
will be outmaneuvered by its competitors when a global market
comes into effect," he said.

To prevent such a thing from happening, Dorodjatun urged
drastic changes to development strategies.

"We have let corruption go on for such a long time, and ended
up with a corrupt society," he said. "Hence the next five-year
national development program must lead to a new civilization
eager to establish innovation in management, organization and
marketing network."

Inequality

Deputy Governor of Lemhannas Juwono Sudarsono supported
Dorodjatun's views, although he said he believed a democratic
economy did not necessarily mean everybody must have equal
income, assets and access.

"Individuals are different by nature, but the government must
help those who are unlucky improve their capabilities," Juwono
said.

"The government can reach the unlucky through policies which
guarantee equal pre-conditions for business competition," he
added.

He suggested an adjustment to the principles guiding
cooperatives, which are Indonesia's economic foundation, to the
current international economic structure.

"The ideals of a cooperative will remain poetic verses if we
do not try to conform them with the world's market-oriented
economy," he said.

Earlier in the day, Minister of Defense and Security Edi
Sudrajat said in his keynote speech that different capabilities
could bring about a wide gap between national companies.

"But it's obvious that to some extent the imbalance of growth
from one company to another originates from unfair competition,
such as discrimination in bids, facilities to complete licenses
and collusion," Edi said.

He said legislation on ethics was needed to avoid the
violations of a competitive economy such as monopoly, oligopoly
and conglomeration, affecting a democratic economy.

Minister of Agriculture Syarifuddin Baharsyah and Minister of
Cooperatives and Small Enterprises Subiakto Tjakrawerdaya also
presented papers yesterday. (amd)