Thursday, December 16, 2004

Short Paper in ATTAC - Paris 1998

INDONESIAN TRANSITIONAL PERIOD;
TOWARD DEMOCRACY OR NEO LIBERAL*
By Mugiyanto**


1. Background
Indonesia with its 209 millions populations is undergoing critical transitional period. The success of the people struggle in overthrowing one of the most brutal dictatorships in this century, Suharto, in fact is not the end of the struggle. There is still a long rocky and mounting way toward the achievement of genuine democracy, social justice and respect, promotion and protection of human rights. The overthrowing of the dictator is only the beginning of the struggle. Besides the struggles against the tendency of the ‘comeback’ of the anti democracy, militaristic and dictatorial pro status quo forces, there ahead is a brutal offensive attack of neo liberalism.
The People’s Democratic Party as a political party aiming at implementing popular democratic multi party system for achieving socialism in a democratic way in political, economic, social, cultural and environmental fields as an alternative for exploitative system of capitalism has experienced brutal repression from Suharto dictatorial regime since its declaration on July 22, 1996. Under the Habibie government, the PRD is able to participate in the election – after 2 years forced to go underground – but 7 of its leaders are still kept in jail as political prisoners.
The PRD realizes that the struggle for genuine democracy and social justice under dictatorial and militaristic regime contain considerable risks and consequences. Furthermore it needs patience and militancy as well. However, there is nothing useless in this patient works of empowering, educating, politicizing and organizing people. The fact that Indonesian people dare to say, act and demand for their rights at the very moment is the investment and seeds for the people to fight for and finally achieve their rights and sovereignty.

2. Indonesia and Global Crisis of Capitalism
The waves of deep economic crisis has affected all layers of Indonesian people since July 1997. The fall of Indonesia rupiah (IDR) toward US dollar (USD) has been rising the prices of basic needs and mostly the imported goods. This reached its peak in March 1998 when IDR fell to 15,000 from its normal value 2,400. The inflation is to fall to 80% in fiscal 1998. This caused the inability of people to afford even their basic subsistence. In 1997, the World Bank estimated that people live below poverty line grows from 12% to 48%. Gross Domestic Product fell by 14% in 1998 and export also fell by 22%.
Most industries, especially those produce imported goods closed down due to its inability in importing materials. Massive lay-off is unavoidable. The government source records the number of about 12,4 millions unemployed.
The banking and real estate sectors go to bankruptcy. The solution done by the government to cure this collapse is the loans from the imperialist institutions, the World Bank and the IMF. Indonesian debts then record the number of about 178 billion USD (80 billion USD private debts and government the rest). The problem, however, is who and how to pay this neck sacking debts.
The US government says that this crisis is caused by the mismanagement of the government and economic system. The practice of Corruption, Collusion and Nepotism (popular with KKN in Indonesian terms) of the government officers and business players is the cause for this. The only solution for this then is to have a clean government, by abolishing such dirty practices of governance capitalism. But we know already that for the US, clean government means neo-liberalism which opens, promotes and accelerates the flows of foreign capital and investments for more profits. The practice of crony capitalism of Indonesian government does not support, even obstruct, the logic of capitalism.
This is also one of the reasons why the Western government, represented by the US, suddenly supports the student-backed people movement to overthrow Suharto prior to May 21, 1998 when finally Suharto resigned from power. Although since Suharto took power through mass killing in 1965, the US government commits to keep supporting.
The question then raised, whether the cause of Indonesian deep economic crisis is merely the malpractice of capitalism which in Indonesian context is the practices of Corruption, Collusion and Nepotism (KKN). The fact that such practices cause the worsening of economic situation is undeniable. But is it the only reason like the US government advocated – and “fortunately” agreed by Indonesian economists? To respond such thesis above, some arguments can be provided.
Firstly, Indonesia is not the only country swept by such deep economic crisis. Thailand, South Korea, Philippines and Malaysia are also countries – in Asia alone – struck by this hurricane, and these countries are those considered to be the Asian Tigers with high GDP of 8% in average. Some countries in Latin America like Brazil and Mexico and in Africa experience the same crisis. Even in advanced capitalist countries in Europe and Australia undergo similar crisis indicated by the increasing number of unemployment and cuts on “unproductive” sectors like health, education and social safety.
Secondly, the practice of KKN in Indonesia does not happen only recently but since Suharto took power in 1965, but the economic grew well. This means that the crisis is not domestic but global and not technical malpractice of capitalism but systemic. Based on this, the solutions then must be also systemic and global and not practical. And this must be based on socialist programs as the alternative to the capitalism.

3. Fall of Suharto and First “Democratic Election” after 44 Years
The deep political and economic crisis in Indonesia in middle 1997 has triggered the radicalism of all layers of society. The situation has enlightened, politicized and radicalized them. Their life is affected. They want to know why and what to do. The fact that the fruit of developmentalism strategy*** of the Suharto New Order regime is nothing but social injustice, deepening gap between rich poor leads the people to the distrust and disappointment to the government.
The process of depoliticization and practice of terror, repression and militarism for more than three decades has mounted and accumulated. Started by students, this seeds of anger and discontent exploded in form of mobilizations against the government when they find their momentum. Due to the lack of political leadership and political perspective, riot and anarchy is unavoidable·. Under such pressure from all sides, both international community and mostly Indonesian people, Suharto has no choice but to resign.
The Election has just been carried out on June 7 under the illegitimate “transitional” government of Habibie, contested by 48 political parties after several undemocratic process of verification and selection. Besides, the ironic thing is the fact that 7 leaders of one of the contestants of the election, the People’s Democratic Party (PRD) are still kept in jails as political prisoners. The military still also play roles in politic due to the concept of Dwi Fungsi ABRI or the Dual Function of the Armed Forces. The 38 reserved seats out of 620 are also given to them in the national parliament. However, Western governments consider this to be the first free, fair and democratic election in Indonesia in 44 years after the democratic multi party election in 1955.
Considering that the target of the election is to have a legitimate democratic government, we afraid that this can be reached. Until today, the counting of the votes is not yet finished. The government announces that the final result of the election will be on July 8, 1999, one month after the polling itself. Many evidences of cheating and manipulations (mostly by the ruling Party Golkar) during the polling and counting are found by independent election monitoring bodies. This will also give invalid score to the legitimacy of the election itself.
In short, the expectation of the majority of people for the June 7 election to have a legitimate democratic government able of solving economic and political crisis will only be an illusion. Besides the basic and principle arguments above, the possible ruling party (until this moment would be Megawati Indonesian Democratic Party of Struggle - PDIP) is actually a conservative party on principle questions like on Military, trial for Suharto, Constitution 1945, East Timor and position on IMF and the World Bank which are just like the policies of the former Suharto Dictatorship in contrast to the demands of students and population for total reforms.

4. Prospect of Democratization and Alternative Solutions for Crisis
To answer the question whether Indonesia will go to democracy and sovereignty of Indonesian people itself or to enter the mouth of imperialist institutions under the direction of IMF and the World Bank, is easy. The PDIP which will be the ruling party – if the bloody hands of status quo does not intervene or manipulate the result of the election – have committed to continue the policy of the previous administration regarding the deal with the IMF. This means that the next new government will unconditionally obey and follow the direction of the IMF and the World Bank.
On East Timor question, they keep on saying that East Timor is part of Indonesia. There is no material basis for the East Timor to be an independent state. On military question, they consider that to do an immediate pull out of military from politic and economic activity is impossible. Although all people knows that the longer the military intervene political and civilian life, the more human rights is abused and democracy is threatened.
About changing or reforming the undemocratic political laws and Constitution 1945, the PDIP considers as a betray because it is a historical consensus and is complete. Whereas we see that many article in the Constitution 45 is incomplete, undemocratic and too short because it was composed under emergency period of proclaiming Indonesian independence and was produced as a provisional constitution. In responding the mass demands to put Suharto to trial for his political, economic and human rights crime as he took power, the PDIP never seriously give satisfactory commitment. This is the nature and characteristics of the coming ruling party – with or without coalition -- in Indonesia.
The only forces committed to total reforms are student movements, grass root radicalized people who actually are the mass base of opposition parties including the PDIP, and the People’s Democratic Party (PRD) and the Indonesian United Democratic Party (PUDI). It is the task of this democratic forces in Indonesia to give pressure from in and out of the parliament, especially through mass movement.
As a closing of this short paper, giving emphasize to the economic situation in Indonesia and especially about the fate of the Indonesian debts is very important. Because this is also one of the big problems and burdens of the coming government and the people in particular on how to solve it.
The basic principle of the people regarding this foreign debts is that there is no transparency about the spending of the debts. Consequently, the people does not feel to receive or take benefit from it neither able to control it. More evidences later appear that the money are corrupted for Suharto and his families and cronies, which is clear as one of the causes of the economic crisis. Then, in fact the debts is the debts of Suharto and his cronies and families and the people has no responsible for paying back that debts. While to just cancel or abolish the debts feels to be unfair.

* Short paper presented in the International Conference “Market Dictatorship? Another World is Possible” in Paris, June 23-26, 1999.
** Mugiyanto, International Department of the People’s Democratic Party (PRD) now in Europe.
*** Policy of the New Order regime under Suharto to prioritise economic growth rather than distribution based on justice. It also neglects mental and political education but physical development.
· This happened not only during the days before Suharto was overthrown on May 21, 1998, but since the last two years. This indicates how weak and small the subjective condition of organisations whose historical task is to lead the people’s uprising compares to the objective condition of the people’s power itself.

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