Fuel subsidies -- legalized daylight robbery

Fuel subsidies -- legalized daylight robbery

Endy M. Bayuni, The Jakarta Post, Jakarta

Anyone looking for an explanation as to why we as a nation are
so corrupt while still professing to be a very religious people
-- a question that President Susilo Bambang Yudhoyono posed when
opening the Muhammadiyah congress just over a week ago -- should
not look further than our collective attitude toward the
government's policy to subsidize domestic fuel prices.

The fuel subsidy, to use the government's argument when it
hiked domestic fuel prices by 29 percent in March, amounts to a
transfer of resources from people in the low-income bracket to
those in higher income brackets. Since the latter are the ones
who use or consume fuel the most, they take the lion's share of
the subsidy. In simple and not-so economic-speake, we are taking
money away from the poor and giving it to the rich.

This is robbery, not only committed right before our very
nose, but also carried out with our full support, consent and
blessings.

Our collective indifference to this crime of taking what is
not rightfully ours, and depriving the poor of what they are
entitled to, makes this a legitimized corruption conducted by the
state on behalf of the nation's elite.

The size of this theft, more than $11 billion this year by the
government's own calculation, dwarfs all other corruption cases
that have been investigated to date, a figure matched probably
only if and when (though unlikely now) the government brings
former president Soeharto to trial for bankrupting the country.

And with oil prices in the world market continuing to rise
above $60 a barrel, the subsidy will keep on climbing because the
government has made it clear that it has no intention of raising
domestic fuel prices further this year.

Our silence and indifference to this anomaly explains a great
deal about our own ambivalence toward corruption.

We loath and attack corruption, and voted Susilo Bambang
Yudhoyono president last year on his anticorruption platform.
Everyone today claims to be with the reformist camp, and everyone
sings the same anticorruption tune.

But, as our attitude toward domestic fuel prices shows, we
draw the line when it hurts our own interests. Fighting
corruption yes, but leave us alone.

Just about everyone in this country, with the exception of the
poorest among us, is in this complicity. Our collective silence
makes us part of the conspiracy to rob the poor of their rights.
The government, which only four months ago called the subsidy
immoral, is now totally silent on the issue even as the subsidy
is soaring. The House of Representatives, religious leaders, the
non-governmental organizations and the media, who all claim to
speak on behalf of the poor and fight for their interests -- are
not saying a word that this is wrong.

It's no use blaming President Susilo Bambang Yudhoyono for his
decision to maintain the fuel subsidy, however high the global
oil prices go up to. He is only doing what the politically
powerful and the elite are asking him to do: Don't raise the fuel
prices because it will hurt us. Implicit in this message is that
they can hurt him too politically if he does.

The trouble with the government's economic team being managed
mostly by businessmen rather than economists is that they
obviously have vested interests in keeping domestic fuel prices
low to help their business friends. Any first-year undergrad
economic student however know that there is a huge opportunity
being lost or foregone by maintaining this subsidy.

That $11 billion would be better spent on providing free
health care for the poor, and free education for the government's
own nine-year compulsory education program.

Or what about the reconstruction of Aceh and Nias, which will
absorb some $5 billion in funds raised abroad? Wouldn't those
foreigners who have generously donated their money for the
tsunami victims feel offended if they knew that wealthy
Indonesians are burning fuel like there is no tomorrow?

And what about raising our defense spending, so that our
military personnel can have a decent salary and weaponry to
regain the respect of the people.

We are not the only country that has been hurt by soaring
global oil prices. But Indonesia is one of the few countries
which is trying to spend its way out of the oil crisis, to the
tune of more than $11 billion, instead of tackling the problem
head-on.

And it is money that we don't really have, or certainly don't
own. This is corruption pure and simple. And we let it pass
because almost all of us are in the take.

Does anyone still believe that Indonesia is serious about
eradicating corruption? I rest my case.

The writer is chief editor of The Jakarta Post.