Small enterprises
Small enterprises
The House of Representatives has finally approved a bill that
will empower and protect small and medium-size enterprises. The
bill was introduced in the House last July, and took only a few
months to be approved.
As pointed out by Minister of Cooperatives and Small
Enterprises Subiakto Tjakrawerdaya, once enacted into law by
President Soeharto, it will provide a more conducive business
climate for small firms to grow and develop. The development is
most welcome in a country where more than 30 million enterprises
make up the backbone of the economy.
When our founding fathers assembled in 1945 to write our
Constitution, they did not envision a capitalistic society. Their
vision was embodied in Article 33, which states that "the economy
shall be organized as a common endeavor based upon asas
kekeluargaan (the principle of the family system)".
The Constitution explained that the economy was to be "based
upon economic democracy" with "prosperity for everybody." The
vision resembles the Gas and Water Socialism of the Fabian
Society, a European concept which may have influenced our
founding fathers. Many were being educated there when the idea of
social democracy was gaining ground.
Implementing that vision, however, has not been made any
easier by 50 years of frustrated debate and poorly-designed
policies. Another constraint is how to properly define an
economic democracy vis-a-vis a family system, where the State has
the controlling power. There has always been a tendency to avoid
juxtaposing the two concepts, when we should be investigating
where they contradict each other to find a solution.
The country's small and medium-size enterprises have suffered
from this long debate. We have had to wait for 50 years before
our representatives could even formulate the definition of a
small enterprise. Even though their performances are not
distinctly and sufficiently reflected in official statistics,
they too are members of the family system mentioned in the
Constitution. When one talks about economic democracy, they are
some of the most important constituents.
One member of the House rightly pointed out that this new law
could end up being more political rhetoric. Implementing the law
will take strong political will, since many measures before did
little to develop small businesses.
It is time that Article 33 be given a more realistic
formulation of what we mean by the family system, economic
democracy, and prosperity for everybody. It is about time as well
to constitutionally define when and where monopolies, oligopolies
and monopsonies are beneficial to the people, and when and where
they are absolutely not so.
Small enterprises have survived and have supported this
country for the last 50 years. They are not begging for help or
special favors. What they need is a conducive business climate so
they can contribute more to the country.