Reform's second wave: Reflections of an optimist

Reform's second wave: Reflections of an optimist

Satish Mishra, Jakarta

The last six years have been years of national trauma. Many of
Indonesia's cherished institutions and beliefs are being
questioned. The external world is pushing it now one way, then
another. The world appears to be an unstable place. Indonesians
long for order and stability.

Despite these pressures there are many reasons for optimism.
Indonesia has persevered though an almost total transformation:
Of each one of its governing institutions, its major enterprises,
its labor unions, its social organizations and even the
relationships within individual families without breakdown and
disintegration. It has accomplished constitutional and political
reforms which would have taken many other countries several
decades to make.

Its political parties and its military organizations have
worked together to ensure a peaceful succession of power over
three presidents in less than four years.

The Indonesian spirit of liberation has come alive in thousand
different ways: through a proliferation of voluntary
associations, religious charities, professional-associations and
media groups. Faced with the worst crisis in living memory,
Indonesians did not wallow in despair. They worked. They built.
They did not fall apart.

On the whole, it remained true to the liberation spirit of
those early independence days; to that powerful emotion of reform
unleashed by the first wave of Reformasi (reform).

Of course, many are apprehensive of the future. Many are tired
of the pressures and uncertainties and unfairness of the change.
Yet, the reform goes on. The surprising results of the recent
legislative elections are proof of that.

The great task of the transition is to understand the power of
the liberation spirit, to have confidence in the people and to
build, brick by brick, a new Indonesia on the foundations of the
old. It is to harness the spirit of the first phase of Reformasi
into the systems and programs of a Second Wave of Reform and
Reconstruction. It is to ensure that no future economic shock or
political storm will lead to a systemic collapse of Indonesia's
entire way of life.

What principles should guide us in constructing a future
program of reform and reconstruction? The answer, drawing on
lessons of history is relatively obvious.

First, the teething problems of creating a new democratic
order should not be used as an excuse to push us back towards a
new variety of dictatorship. It should not be forgotten that it
was the internal weaknesses of the New Order which was directly
responsible for pushing us into the most severe economic and
social crisis of our time.

Nothing will be gained by repeating past mistakes. We must go
forward not backwards. Going forward means building a well
functioning, orderly, and stable democratic system for Indonesia.

Second, government economic programs must touch the lives of
the average Indonesian, not just the ones who became well off
under the New Order or those who have done well out of the
confusions of the monetary crisis. Food for the family, education
for Indonesia's children, health-cover against common diseases,
protection against criminality and physical assault are things
that we all need to function as free human beings.

Democracy which stops at five yearly elections of distant
leaders will not win the hearts and minds of the Indonesian
public. It will not take root in Indonesia. Economic progress
must be therefore measured not in terms of growth rates of gross
domestic product (GDP) or confidence of foreign investors but in
the way in which the lives of our people are changed by it.

Jobs not GDP must be the slogan of future Indonesian
democracy. We must not fall into the New Order trap of equating
aggregate growth rates of national income as the organizing
principle of our political system. We must work out a new
economics of democracy, one anchored on a set of clearly defined
and recognized rights, obligations and duties of the citizen and
the state.

The basic question is once again of balance and perspective,
not statistics and formulae. Indonesia badly needs the resumption
of economic growth, to provide jobs and support to our poor and
sick. But not all growth, as we have already learnt by the bitter
experience of the past, is the same. Growth to be meaningful must
be shared by the many, not restricted to a few individuals or a
few already well off regions.

Equally true is the fact that growth needs a resumption of
investment; yet not just any form of investment. We need
investment of the right kind, one that is sustainable, rooted in
our own economy and one that raises our future productivity and
the competitiveness of our goods. There are different kinds of
investment as there are different patterns of growth.

While difficult to resist, the fascination with overall rates
of economic growth and investment ratios is a carry over from the
politics of the New Order. For that reason it is attractive to
many schooled in the old tradition. Yet, a second major lesson
learnt during the difficult years of the current crisis is that
investment and growth of the future depends not so much on the
confidence of banks and investment houses as that of the general
public in Indonesia's own governing and social institutions.

What is needed to restore public confidence and bring a wider
social legitimacy to the new democracy, is growth which is
generated from a wider sharing of business and employment
opportunities, an economic growth based on ability not kinship.

Economic recovery based on the same pre-1997 foundations of
privilege and connection is bound to fail in raising public
confidence in Indonesia's new governing institutions. Without
domestic, public confidence, the political and security
environment will remain unstable. Investment will remain a gamble
on the herd instincts of a few leading business corporations.
Growth, even if strong for a short while, will in the end falter
and fail.

We cannot afford any more false starts on the road to economic
recovery. Sudden collapses of our economic and political
institutions such as that occurred in 1998, sharply increase the
underlying frictions in our society.

Third, we must rebuild a united Indonesia. This is not just a
question of geography but of national identity. A united
Indonesia cannot be built on force and coercion. In the past
national security has often been equated with armed force. It is
time to move to a broader concept of national security, one which
combines the creation of an organized, well financed and
disciplined police and armed force, with a strategy for tackling
the root causes of alienation and despair.

The Second Wave of Reform and Reconstruction must thus be
driven by an overall vision which seeks to consolidate Indonesian
democracy; root broadly shared economic growth in a set of
competitive, regulated, open market institutions, and a national
unity built not just on organized force, however well motivated,
but on a new framework for human security.

The writer is Head/Chief Adviser of UNSFIR (a joint project of
Government of Indonesia and UNDP). The views expressed here are
strictly personal.