Poverty on the rise

Poverty on the rise

How much we are at present racing against time is illustrated
clearly by the problems which we are facing. A researcher at
Gadjah Mada University's Center for Population Studies, Muhajir,
predicts that 130 million Indonesians will be living in poverty
by the end of next year. This is more than half the total number
of Indonesians. This explosion will be caused, among other
things, by the lack of job opportunities and high inflation.
Other predictions are even more gloomy, especially when political
aspects are taken into account.

Our private sector cannot be counted on to help us surmount
the problems we are currently facing. The government must assume
the role of primary driving force by actively intervening in the
monetary and banking as well as the real sectors. The government
will have to make an effort to boost aggregate demand for goods
and services in order to steer the economy back to full
employment conditions.

Aside from this Keynesian recipe, another suggestion offered
is that the government put the priority on promoting domestic
demand, since the still-weak traditional market is not likely to
be able to absorb our export products. Then, too, competition
from other countries which, like ourselves, are striving to take
advantage of the low exchange rate, will be fierce.

Whichever scenario is followed, the government will have to
assume the dominant part. Unfortunately, it cannot play that role
to the full as long as it is being shaken to its core.

-- Bisnis Indonesia