Sat, 27 Jul 1996

Reinventing Indonesian society

By Meuthia Ganie Rochman and Rochman Achwan

NIJMEGEN, the Netherlands (JP): The market economy's undisputable lead over socialism and the rise of giant economies in the Pacific have led social scientists to search for the causes of the successes and failures of other countries' economies.

They are faced with moving and inspiring issues: Can the success story of industrialization in the West be repeated in developing countries and East European societies? Should those societies simultaneously undertake a double transition, namely democratization and the introduction of a market economy? Is it possible to argue that authoritarian regimes can exist together with market economies in heading toward prosperity, a notion that social scientists humorously refer to as "sleeping with the enemy"?

Francis Fukuyama, a renowned sociologist, recently published his new book titled Trust: the Social Virtues and the Creation of Prosperity (1995).

Unlike neoclassical economists, who emphasize the importance of economic rationality as a conditionality in reaching prosperity, and in contrast to Samuel Huntington, who predicted the "clash of civilizations", Fukuyama believes in the role of culture in bringing about prosperity.

Differences that cultures within a nation encounter, considering they have been equipped with a high level of social trust among their members, will lead to the age of prosperity. Therefore, preservation and accumulation of associations in which social trust is the most important ingredient will be "the battle cry" of every society and nation in the future.

Although his new book attempts to explain the importance of cultural factors, Fukuyama is not an anti-neoclassical economist. Instead, he argues that the neoclassical economic approach undoubtedly contained 80 percent empirical truth in explaining the essence of money and the market.

What he disagrees with is the approach assumes that economic actors always act rationally in decision making. According to Fukuyama, individual economic actions often rely on what he calls "ethical habits" or "habits of the heart" which historically exist in the society. Relations among individual economic actors therefore are established by a combination of rational calculation and morality.

Fukuyama's formulation of the importance of the issue of associations in economic life is reminiscent of the great French sociologist Emile Durkheim: Human beings need secondary associations to organize a better social life. The state is often abstract, distant and bureaucratic in facilitating society to take collective action.

In an attempt to examine the functioning of associations in the society, Fukuyama establishes several conceptual devices: social trust, spontaneous sociability and social capital. By social trust, he means that socioeconomic relations among individual actors should rely on cooperation and trustworthiness. Social trust can be directed and disseminated to members of families, groups, professions and nations. Social capital emerges out of social trust, and its levels depend on how communities socialize shared values and norms which can be directed to form mutual cooperation. Spontaneous sociability is considered to evolve out of social capital in the form of new associations whose members are able to simplify the complexity of economic relations.

A world society can be divided into two types: societies with the lowest and highest levels of trust. Societies with the lowest level of trust are characterized by a limit of socioeconomic relations to the family, while the other is marked by the growth of associations which exist beyond family boundaries.

Societies in mainland China and Hong Kong represent the societies with the lowest trust level, characterized by the existence of limited generalized norms which make it difficult for their members to form associations beyond the family sphere. The cultural background of these societies is manifested in their industrial structure, which is dominated by small and medium industries. Conversely, Japanese and German societies are capable of forming associations, as they are manifested in the existence of large-scale industries successfully directing the world market.

The low level of social trust, and therefore the limited coverage of associations in the society, does not necessarily lead to the domination of small and medium industries. The role of the state, through a set of economic policies, enables it to facilitate the shifting of these industries into large-scale industries.

The involvement of the state, however, can bring dangerous risks if it does not care about the substance of authority relations within associations, which historically emerge and grow in the society. The success story of South Korea is a case in point. Under the late president Park Chung Hee, the state played a vital role in economic life by behaving as head of household or as patriarch, controlling financial institutions and providing credits and large-scale economic projects to reputable businessmen. Those businessmen -- bureaucrats and political leaders who were involved in corruption or bribery -- were taken to court and punished according to the laws which relied on the moral justice of society.

The societies with high levels of trust do not always necessarily become leaders of the world economy. As important hurdles within and among associations need to be overcome in order to achieve prosperity, associations could rupture and finally tear apart the basic foundation of social trust within the society.

America's society belongs to this category. America actually is a society which historically possesses extraordinary richness in developing associations.

At present, however, American society is losing the soul of mutual cooperation and therefore is having difficulties developing mutual trustworthiness among its members. The wave of excessive individualism and liberalism has not only undermined values of cooperation, but is also beginning to affect family values.

All forms of American associations which previously inspired prosperity have broken down, giving way to the birth of social unrest. It is not surprising if one witnesses how American leaders have attempted to cure dangerous social diseases by salvaging and reinventing the defective associations.

Issues relating to the importance of family values -- which have became the political platform of the Republican party during the election campaign -- the emergence of the Christian Coalition as an influential political lobby and the emergence of the Nation of Islam, should all be understood as attempts to reinvent associations capable of confronting the present uncertainty of the world economy.

In his book, Fukuyama analyzes how seven countries with their unique cultural backgrounds successfully piloted the "airways of industrialization" to reach the final "airport of prosperity". Those countries are Taiwan, Italy, France, South Korea, Japan, Germany and the United States. Different local "cultural runways" can be landed on smoothly by the "airplane" of modern industrialization. Conversely, the "airplanes" can take off from those "runways", heading toward the final destination: prosperity. The local "runways" take different forms, ranging from communitarianism (Japan and Germany), familism (Taiwan), patrimonialism (South Korea) to benign individualism.

The book successfully reveals a new "battle cry" that has to be subdued by any society and nation. This is a sort of battle that requires members of societies and their leaders to construct new associations, inspired and cherished by the "habit of the hearts" as the soul of societal life, and directed to achieve rational economic goals. The emergence of the construction of associations is believed to reduce highly socioeconomic and political transaction costs or the high-cost economy.

Economic growth and social order based on genuine associations -- not political stability -- are believed to foster the birth of prosperity. Concepts of political stability always favor the powerful and elite groups in defining what is morally good and evil. The "habit of the hearts" or ethical habits therefore are often missing from the conception of political stability.

Take Indonesia as an example. Nono Anwar Makarim, one of Indonesia's brightest intellectuals, lamented that in the midst of achieving a certain level of prosperity which had never been achieved throughout Indonesian economic history, he consciously felt that he no longer had a hero -- even a single leader -- who was competent to direct his future life (Kompas, June 23, 1996).

Indonesia does not have any visionary leader who is capable of shedding new light on the process in the present age of unexampled change. Political morality, economic morality and intellectual morality are rare commodities and, sadly enough, they are steadily approaching the brink of breakdown. The achievement of a certain level of prosperity tends to be eclipsed by societal demoralization. The "habit of the hearts" which embryonically evolved out of Indonesian society in the early period of post independence has already been torn apart.

Present Indonesian society, Makarim said, is trapped by the dangerous disease of moral amnesia. It is therefore high time for Indonesian social scientists to seriously and consciously define our societal problems.

By defining them, social scientists give meaning and direction to our society. By giving direction, they will become part of the national leadership, together with political and business leaders, to give vision to which destinations our society pursues.

Reinventing Indonesian society should be put as the only grand theme shouldered by Indonesian social scientists. It is, however, very sad if Indonesian social scientists fail to address these very difficult social problems. Should this happen, Indonesian social science will be lame, tepid and stupid.

Finally, Indonesians will still have to continue to live in the bleak house of personal uneasiness and moral disintegration in the years to come.

Meuthia Ganie Rochman is writing a doctoral dissertation in political sociology at the University of Nijmegen, the Netherlands.

Rochman Achwan, a lecturer at the Department of Sociology, the University of Indonesia, is completing a doctoral degree in economic sociology at the University of Bielefeld, Germany.

Window: Indonesia does not have any visionary leader who is capable of shedding new light on the process in the present age of unexampled change.