Posts made in May, 2014

Krismon

Posted by on May 13, 2014 in Uncategorized | 0 comments

Krismon

Indonesia is facing challenges not seen since the hunger and chaos of the 1960s. The economy is on the verge of collapse and the lenders from the International Monetary Fund (IMF) are standing in the wings baying for economic reforms that undermine the pyramid of privilege and patronage that has allowed Suharto to wield such control over this vast nation.[1]   Foreign investors embraced Indonesia as a “newly industrializing economy” due to its consistent economic growth rate of about 7 percent between 1979 and 1996. Foreign funds flooded Jakarta’s fledgling capital markets during the 1990s boom years as investors sought added octane from the fast-growing emerging markets. The decade was marked by a construction boom in Jakarta and, to a lesser extent, in other Indonesian cities. The huge outside capital injection through dozens of loosely-run and even more loosely regulated banks financed upscale shopping malls, hotels and glimmering office towers everywhere. Chinese conglomerates had started taking working capital out of Indonesia as early as 1990 when President Soeharto proposed confiscating one-quarter of their equity. Sniffing the first signs of trouble during 1995, cautious Sino-Indonesian businessmen accelerated their wealth transfer to safe havens like Singapore, Hong Kong and Australia, even as foreign investment funds flowed into the rising Indonesian markets. Domestic banks and businesses were leveraged with questionable assets and vulnerable to the sudden capital outflow, but the government provided a floor of stability by pegging the currency at a fixed rate of about 2,500 rupiah to the U.S. dollar. Easy money fueled speculative investments and risky loans, and perpetuated crony capitalism – bribery, kickbacks and shareholdings “gifted” to government officials, family members and associates. The Bre-X scandal of early-1997 – involving the spurious claim that enormous gold deposits had been discovered in the Busang region of East Kalimantan – exemplified the prevailing “wild west” investment atmosphere. The Canadian mining firm Bre-X had pronounced Busang one of the largest gold deposits ever discovered. Before it was revealed as the biggest mining hoax in history, Bre-X attracted significant wagers from the Soeharto foundations and the President’s oldest son, Sigit. Despite their stakes in the venture, in accordance with the rules of crony capitalism, Sigit and his father apparently lost little since they didn’t pay for their shares. Less than four months after the Bre-X exposé, the Asian economic crisis started with Thailand’s emergency devaluation on July 2, quickly spreading to Indonesia and other Asian countries. As speculators and hedge funds placed large bets against the rupiah, Indonesia was forced to abandon its dollar peg on August 14. The currency dropped 10 percent. After resisting for weeks, in early-October Soeharto agreed to seek help from the lender of last resort, the IMF. With western and Japanese encouragement, the technocrats negotiated a $33 billion “emergency rescue package.” Announced on November 1, the bailout plan was accompanied by an extensive list of structural reforms intended to restore investor confidence. Prescribed reforms included the most egregious cases of government-sanctioned rent-taking – Tommy Soeharto’s Timor national car project and clove monopoly, Bob Hasan’s Indonesian Wood Panel Producers Association (Apkindo) cartel, and Liem Sioe Liong’s protected Bogasari...

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The Pemuda Culture

Posted by on May 9, 2014 in Uncategorized | 0 comments

Indonesian culture has long glorified the pemuda movement. Youth played a significant role throughout modern Indonesian history as early advocates for independence during the colonial period. The Youth Pledge (Sumpah Pemuda) in October 1928 vowed allegiance to one nation, one fatherland and one language. The Japanese encouraged the national pemuda culture by mobilizing millions of mostly Javanese youth into mass social, paramilitary and military organizations. “They acquired a fascinated respect for the manifestations of power – and an acceptance of violence almost as a virtue in itself. More importantly, the experience gave some of these young men a prospect of direct participation in the affairs of the nation when the time came. In due course this was to make ‘youth as such’ – the pemudas – an independent element in nationalist politics and to affect the setting in which Sukarno’s own part was to be played.”[1] Indonesian youth consequently played a central role in the Indonesian Republic’s birth. Emotional pemuda kidnapped Sukarno and Hatta on the eve of the Independence Proclamation. They became “a new and dynamic social force.” Their ideals were clothed in “the virtue of struggle” bordering on anarchism. Imbued with a revolutionary fighting spirit, tens of thousands of Indonesian youth fought valiantly with Republican forces under difficult circumstances. General Sudirman was twenty-nine years old when he became Commander (Panglima Besar) of the Armed Forces. Other top military leaders were younger, while many rank and file soldiers in the Revolutionary Army were mere teenagers. Consequently, most officers had a close spiritual kinship to the pemuda movement. Student Army (Tentara Pelajar) volunteers served throughout Java during the Revolution and forged bonds of comradeship with military and civilian leaders through their common struggle. Most youth who volunteered during that struggle to a great extent abandoned their own ethnic and community affiliations for a larger nationalist identity. Many youth perished during the war and many survivors went on to become national leaders following the December 1949 transfer of sovereignty. As the embodiment of the pemuda culture, university students were (and still are) highly respected by most Indonesians. Although young and inexperienced, university students have always been considered the nation’s best and brightest. When Indonesia achieved independence, education levels were low. Only a handful of Indonesians were able to attend college during the colonial period. Following the independence struggle, university students continued to be a major force during the Republic’s early years, applying pressure on civilian leaders through “people power” street demonstrations. Soeharto and his New Order supporters understood the pemuda movement’s ability to influence public opinion and exploited Student Action Fronts in 1965-1967 to unseat Sukarno. Soeharto also realized pemuda power was a double-edged sword. He and his New Order supporters were paranoid about any domestic opposition, particularly dissent originating from student or youth organizations. They co-opted some anti-communist student activists with official positions in New Order regime. Nonetheless, during country-wide protests in 1974 and again in 1978 over official corruption, government economic policies and authoritarian practices, Soeharto suppressed many of the same youth activists who had swept him to power. In the end, it was the students (this time...

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Hubris

Posted by on May 2, 2014 in Uncategorized | 0 comments

Hubris

Critics refer deprecatingly to the state over which Suharto rules as “the new Mataram,” an allusion to the dominant kingdom on Java in the years after 1582 and to the president’s success in evoking the atmosphere of a Javanese kraton (palace), in which politics is frequently a matter of court intrigue and in which one powerful “prince” is played off against another for the greater good of the ruler.[1]   Soeharto built a patrimonial state behind a western-style development façade. Governed by the patron-client relationship, officials were granted position and privilege at the ruler’s pleasure, subject to dismissal at any time without reason. The President’s family and, to an almost equal extent, those he considered friends, were the first loyalty – even more important than his sacred national development programs. He spoiled and indulged his children – perhaps because of his own impoverished youth or to make up for years of neglect. They displayed brazen greed and received generous concessions, unfair monopoly licenses, soft loans and preferential access to government contracts. The children attracted all sorts of ventures purely because of their proximity to power. As they aggressively expanded their business activities, they came into direct competition with military businesses and generated resentment within the Armed Forces. As the feudal king, the government was an extension of Soeharto’s family. In accordance with the Javanese saying, Mikul Duwur Mendem Jero, meaning “carry high” the honor and reputation of the family while “burying deep” anything that would dishonor it, he never tried to restrain the children’s excessive and corrupt behavior, even while resentment and criticism grew. Increasingly isolated, the President seemed unconcerned by the damage to his own reputation caused by the rapacious behavior of his children, family and friends. His ties to Sino-Indonesian businessmen, allowing the chosen few to develop huge and immensely profitable conglomerates, came at great expense to his image. By the early-1990s, the public had adopted the acronym KKN (Korupsi, Kolusi dan Nepotisme) as a codeword for the systematic state-sponsored larceny that took place under the New Order regime. “Suharto believed his children were entitled to be as privileged as the princes and princesses of the sultans of Surakarta. He did not feel any embarrassment at giving them those privileges, because it was his right as a mega-sultan. He saw himself as a patriot. I would not classify Suharto as a crook.”[2] Soeharto maintained the delusion his children had gained success by their own skills rather than special privilege, and that their government-subsidized ventures contributed to his own employment and national development goals. He vigorously defended them. “None of my children has been pampered. Not one. And Thank God, so far not one has done anything improper or out-of-bounds of human decency. … They are actually self-effacing, and I can see that they feel it is difficult being the President’s children.”[3] They had started reaching adulthood in the early-1980s. None excelled academically, although Soeharto’s second daughter, Titiek (Siti Hedijanti Harijadi), graduated from the Economics Faculty at the University of Indonesia and youngest daughter, Mamiek (Siti Hutami Endang Adiningsih), earned a degree from the Bogor Agricultural Institute. In...

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SBY’s Secret Marriage

Posted by on May 2, 2014 in Uncategorized | 0 comments

SBY’s Secret Marriage

In July 2007, former Deputy Speaker of Parliament Zainal Maarif, a minority party legislator, dropped a bombshell. He disclosed President Susilo Bambang Yudhoyono had married and had children before entering the Military Academy. Maarif waved a packet of documents, boldly informing fellow lawmakers he held proof of the President’s youthful indiscretion. Under threat of a slander suit, Maarif retracted his statement and apologized. A few months later, he joined the Democrat Party.[1] Soeharto-era Army Chief General Hartono and others, including celebrity lawyer Adnan Buyung Nasution and hardline Muslim politician Eggi Sudjana, later hinted about the President’s secret marriage. The harsh reaction to each revelation suggested there might be truth to the allegations. Hartono was reportedly silenced after the President’s assistants threatened to reveal his financial dealings. Yudhoyono’s inner circle kept the story from the mainstream, although details were posted on several internet sites.[2] According to uncollaborated accounts, after Bambang Yudhoyono graduated from high school in Pacitan, East Java, he continued studies at Airlangga University in Surabaya, where he met a woman named Ida of mixed Javanese-Filipina blood. They married in a civil ceremony in 1968. Yudhoyono dropped out of the university when Ida became pregnant. The couple moved to Malang; he enrolled at the local teachers university. Two daughters were born, Adina and Devi. Yudhoyono applied and was accepted into the Military Academy in 1970 but lied on the application since cadets are required to be single. Ida and the two girls stayed behind in Malang. She agreed with the deception to support her husband’s future prospects. Cadet Yudhoyono was bright and handsome; he worked hard and excelled at the academy, attracting attention from Military Academy Governor Sarwo Edhie and his daughter, Ani. Bambang graduated first in his class but abandoned his wife and family. He and Ani wed in 1976. He did not tell Ani or her family about his earlier marriage. Several years later, after Ani had given birth to their first son, Agus Harimurti, Yudhoyono confessed his dark secret. Ani was hurt and angry, their happy marriage almost ended. Ultimately, Sarwo Edhie’s family intervened. Ida granted Bambang Yudhoyono a divorce and agreed not to request legal status for her two daughters if he would support them financially. Ida remarried to a German man and moved to Germany, leaving Adina and Devi in the care of her parents in Jakarta. Yudhoyono paid for their education. After Adina was engaged to Danang, son of Lukman Hakim, a senior official at the state oil company, Pertamina, later convicted on corruption charges, then Major General Bambang Yudhoyono agreed to host the wedding party at his Cilangkap residence in southeast Jakarta. Adina and Devi were both by disappointed because he introduced them as his nieces. Adina sought a civil judgment after Yudhoyono was elected president. In a settlement, she was awarded two houses in Jakarta’s posh Menteng and Pondok Indah neighborhoods. Before Yudhoyono ran for a second five-year term in 2009, Ani stayed in close contact with Ida in Germany and the two daughters to make sure the scandal did not derail her husband’s reelection prospects. She reportedly promised her husband...

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