Questioning the business of Indonesian military

Questioning the business of Indonesian military

Bila ABRI Berbisnis (When the Armed Forces Goes Into Business);
Indria Samego et al.;
Mizan, Bandung, 1998;
220 pages;
Rp 17,600.

JAKARTA (JP): After more than 30 years as part of the New
Order regime, the military (the Armed Forces [ABRI]) is now
criticized by many circles in the community as being only a tool
of the authoritative power. Under the New Order regime, many
incidents of violence, killing and human rights violations were
committed by the military. As part of the New Order regime, the
military impeded the progress of democracy. Therefore, the
demands for the revocation of ABRI's dual function have been on
the increase.

Apparently, ABRI's image has become poorer in the people's
eyes. The military has been asked to return to its barracks,
making itself a pure force for defense and security. Now,
seemingly, the military is being penalized by history.

From the beginning, with the logic of command, hierarchy,
physical force and heavy arms, the institution and character of
the military have indeed been not human and not democratic.
Because ABRI became a sociopolitical force, there were many
incidents of violence, power abuse, monopoly, corruption and the
like, in cooperation with, and even committed by, military
groups. One example is in the economic field, specifically the
business sector.

Bila ABRI Berbisnis clearly discloses corruption data and
incidents in military circles. From the data and events we
observe in this book, an analysis can be made that business in
military circles, from time to time, only resulted in evil for
this country, especially for its people. The business in military
circles only benefits ABRI -- in a narrower sense a number of
military individuals -- on the one hand, but enhances practices
of corruption, collusion and monopoly on the other. It is here
that the people suffer losses inflicted by the military.

In this book, quite a few incidents and events are disclosed
about monopoly, corruption and collusion conducted in the
business arena of the military. Collusion takes place between
capital holders (economic regime), many of whom are ethnic
Chinese, and the military to rake in the country's wealth. In
these business episodes, ABRI also became part of the political
and economic regime in this country. It is, therefore, not
surprising that many high-ranking military personnel are
fabulously rich, even in their retirement.

Power abuse in ABRI's business disclosed in this book includes
those committed by former president Soeharto from the time he was
building his career in the military world. Then he was already
practicing corruption, collusion and nepotism in a cowardly way.
He was caught red-handed several times and reprimanded by his
military superiors. But at other times, his dishonest business
practices were repeated using improved stratagems.

Since the end of the 1960s, sharp criticism started to occur
on the military's involvement in business. Nusantara daily
newspaper reported that ABRI's involvement in business with
Chinese businesspeople only bolstered collusion in this country.
Moreover, a number of state enterprises led by ABRI became
bankrupt. The leaders (military) were only interested in
enriching themselves (page 70).

This book states that ABRI's involvement in business has given
rise to corruption in military circles, from soldiers to
generals. Apparently it is not a matter of survival for the high-
ranking officers, it is a matter of personal greed for wealth and
power (page 135).

Military involvement in business since the beginning of
independence gave birth to a type of client businesspeople. They
were not the type of free and independent middle class
businesspeople but a class that made facilities dependent on
political patronage in the era of legislature democracy, or
bureaucracy and military patronage in the subsequent periods.
Therefore, it is not surprising that such practices led to
expressions like pengusaha aktentas (briefcase businesspeople)
and perusahaan Ali Baba (Ali Baba companies, meaning cooperation
between indigenous Indonesians and ethnic Chinese businesspeople)
and the comprador.

In this era, the military presence in the business sector
often gives rise to high costs and the absence of a competitive
climate on the one hand, and the emergence of invisible costs in
development on the other. In this context, the capitalist system
being built gives birth to a collaborative class between the
military and the Chinese.

The tendency increased in the post 1980s with the various
regulations issued by the government favoring these collusive
practices. The package of economic deregulations, for example,
created unwanted children subsequently called the conglomerate
class. Although this helped facilitate running businesses, they
sought protection from influential figures, in the government and
especially in ABRI, who wanted to give a helping hand.

In the structure of business coalitions in elite circles, ABRI
is seen as a supporter of ersatz capitalism, neopatrimonialism,
state corporatism or a state qua state system which also contains
elements like collusion, corruption and nepotism. Ersatz
capitalists can, in a simple way, be seen as a group of
businesspeople who are very dependent on the government and who
are not able to stand on their own or do business independently
without the government's support. Ersatz capitalism in this
context is seen as a system that enhances a group of rent
seekers.

The above model of collusion has not yielded an independent
local middle class that is not only needed for economic
development but also for political development in Indonesia.
Therefore, the system that enhances collusion between government
officials/ABRI and local and foreign businesspeople, mainly
during the 32 years of the New Order regime (1966-1998), has not
been able to consolidate Indonesia's economic fundamentals and
allow political and economic reform.

According to this book, as long as state corporatism, state
qua state system, neopatrimonialism and the various supportive
elements like corruption, collusion and nepotism involving ABRI
still take place, political and economic reform in Indonesia is
hard to implement. Reform can be carried out only if the root of
the problem is abolished, i.e. the revocation of the concept of
ABRI's dual function, in this case the involvement of ABRI in
business and politics (page 141).

This book, written by intellectuals and researchers from the
National Institute of Sciences like Indria Samego, Riza Sihbudi,
Nur Imam Subono, Sri Yanuarti and others, is apparently the first
book to disclose data and incidents of irregularities in ABRI's
business practices.

Compared to the incidents in reality, however, the analyses in
this book still look very minimal and very limited. It also lacks
sharpness and courage.

-- Arief Hakim