Mubyarto promotes 'Pancasila economy'

Sri Wahyuni, The Jakarta Post, Yogyakarta

While many people may cynically view Pancasila as a tool that former president Soeharto used to repress people, economist Mubyarto has never lost his high regard for the state ideology established by Indonesia's founding fathers.

Mubyarto, a respected rural economics specialist from Gadjah Mada University, continues to publicize his concept, the Pancasila economy, which he believes is more suitable for Indonesia than a capitalist economy.

In September, the professor founded the Center for Pancasila Economy Studies, which he currently chairs. He has been ardently campaigning for the establishment of this center in other universities throughout the country.

His idea has been warmly received, and at least two universities in Semarang and three in Yogyakarta have expressed an interest in starting their own centers.

They are Diponegoro University and Semarang State University, both in Semarang, and Yogyakarta Atmajaya University, Sarjanawiyata Tamansiswa University and the Wangsa Manggala University -- all in Yogyakarta.

"When at least 10 centers are established, we will set up an association of these centers as part of the effort to make the Pancasila economy a reality," Mubyarto told The Jakarta Post.

His insistence in developing the Pancasila economy is raising some eyebrows now that the capitalist economy has become the mainstream and is practiced in Indonesia, too.

"The neoliberal capitalism concept does not have an altruistic soul. Neither does it have any ethics. The only thing it concerns is how to control the world," he said.

Mubyarto said the capitalist concept was based on theories that he said were not entirely realistic.

The concept, for example, assumes that households are not producing anything of economic value -- only companies do -- and it draws a dividing line between businesses and households. Businesses are producing while households are consuming, he said.

"This is unrealistic. It's not suitable for Indonesia. We have productive households. They breed chickens, sell blocks of ice, and so on. In short, Indonesian households are productive," Mubyarto said.

Another theory that Mubyarto means to correct with his concept is the assumption that humans' needs are infinite while the material to fulfill those needs is finite.

"The capitalist economy sees man as mere homo economicus, or the economic human being. This is completely wrong," Mubyarto said.

He said that Adam Smith, the economist who introduced the concept of homo economicus in his 1776 publication Wealth of Nation, also wrote in 1759 in the Theory of Moral Sentiment that human beings are also homo moralis and homo socius, (moral and social beings). Unfortunately, this has not been discussed at schools, he said.

"What we are taught in school is that man is always after profits and is selfish. That is what a capitalist economy says about humans. We are not taught that people also have the desire to live together peacefully," he said.

Mubyarto is known as a prolific scholar who has written numerous books and papers, mostly on the agriculture economy, rural economy and poverty.

Internationally, according to Mubyarto, there has been a concerted effort to confront the neoliberal capitalist economy as done in the recent annual World Social Forum in Brazil to challenge the World Economic Forum in Switzerland.

The term "Pancasila economy" has been used instead of the people's economy in recognition of Gadjah Mada University's role in developing the Pancasila philosophy. In 1995, it established the Center for Pancasila Studies.

The terminology also aims at reminding people of the five tenets of Pancasila.

"Not using the term would be a big mistake because it would amount to rejecting the state ideology. We mean to restore Pancasila's image," said Mubyarto.

The Center for Pancasila Economic Studies aims at building awareness that the current economic and business system based on capitalist principles is not suitable for Indonesia.

The center is also encouraging a review of high school and university curriculums to change the focus from it being capitalism-oriented to people-oriented.

"We have had comprehensive discussions with the curriculum team at the Ministry of National Education about our vision," he said.

Mubyarto was the initiator of a project that was aimed at helping impoverished villages (IDT), which later was adopted as the state policy in 1997.

A graduate of Gadjah Mada University's School of Economy in 1959, the 65-year-old, who was born in Yogyakarta, started introducing the concept of a Pancasila economy in the 1980s.

Soeharto's New Order regime said that Mubyarto had stolen the idea from the government, which deemed the idea as "wrong".

"Now we have the support of the Ministry of National Education, which had set up a special commission called the Commission of Pancasila Economy Studies," said Mubyarto, who is also a 1965 Ph.D. graduate from Iowa State University.

Mubyarto is pleased that the concept will be included in the 2004 school curriculum.

He believes that his efforts to change the economic system will succeed due to this strong support and that business practices in Indonesia will become "more humane".

"Competition is good for business, but it has to be accompanied with the spirit of cooperation to make it more human," said Mubyarto, who is a recipient of, among others, the Bung Hatta Award in 2001, the Satyalencana Pembangunan Koperasi award in 1998 and the Bintang Mahaputra Utama award in 1997.