Beurocratic Authoritarianism in Indonesia (1965-1997)

1. Beurocratic Authoritarianism in Indonesia(1965-1997) brad hatch

2. The Old Regime • Economic turmoil following Indonesian independence precipitated Suharto’s rise to power. • Falling export revenues with rising demands from urban constituents the Sukarno government moved toward deficit financing and anti-foreign nationalism. • Inflation rose at a rapid rate such that by 1965 it turned to hyperinflation • Suharto seized the moment

3. Origins of B-A • Suhato rose to power with the help of the army • He immediately organized the destruction of the ethnic Chinese minority, which was believed to be the base of the PKI • Conservative death tolls are in hundreds of thousands, while some reports cite more than 1,000,000 • Amid the destruction Sukarno handed power over to Suharto on 11 March 1966 • Indonesia passed from the Old Order to the New Order

4. New Order • Assumed power amidst great inflation and promptly sought stability for his regime. • Built connections with a group of US trained Indonesian economists, AKA his technocrats • Preached greater ties with the West, and Suharto took great pains to endear himself to the Western countries. • As a result, generous flows of aid from abroad soon followed

5. Economic development • Suharto and his technocrats felt that Indonesia couldn't compete with China at home or Westerners abroad. • Encouraged multinational investment, which generated tax revenues • This policy differed from that of the Old Order who got little tax revenue • Throughout 1970’s continued aid from Us, Japan, Europe • foreign capital flowed in and foreign firms proliferated, while Suharto maintained social order • consolidation of economic (as well as social and political) control from villages to national level. • average economic growth of 8% per year during his three decade rule • Indonesia made the journey from economic disarray to an Asian Tiger.

6. Eco dev’t cont:Crony Capitalism • He also turned the country into a family business • Suharto’s family and friends were virtually synonymous with Indonesian big business • Arranged economic life to the point where it was virtually impossible for an Indonesian to make any purchase without some profit ending up with the first family • Within this context, there was much corruption within govt. • 1997 World Bank report claimed that at least 30% of gov’t development funds were diverted through informal payments to gov’t personnel and politicians and the ruling party faction GOLKAR. • Before his resignation the the Suharto family’s personal wealth had been estimated at $4 billion.

7. Political development • Suharto was the dominate figure, who controlled all aspects of political life. • Limited opposition, both in parties and media • State had own political party-GOLAR, became compulsory political affiliation for all govt. employees • During his rule, rival parties (of which only 2 were permitted) were subject to significant state manipulation • Thus, opposition was effectively silenced so the country (and by extension his family) could benefit economically.

8. Insecurity Forces • Under Suharto’s rule the military served as the president's right arm, constituting a powerful force that penetrated every village. • The military were part of the political establishment, as the Indonesian constitution assigned them the dual function of defending the country from external invaders and guiding its internal political development. • Also, they were assigned a block of seats (38) in the parliament, which was not very important during Suharto’s rule as parliament simply served to rubber stamp the president’s policies • But, this has the potential to complicate Indonesia’s transition to democracy since Suharto’s fall

9. Beurocratic Authoritarianism • Suharto’s regime exemplifies B-A as defined by Waltz • (1)Populist forces were controlled through a repressive state apparatus • (2) Technocratic elite played an important role in rebuilding the economy once Suharto rose to power, and the military was utilized to maintain social order so uprisings would not impede economic success • (3) Extreme centralization of public policy, such that Suharto dominated every aspect of political life ; a strong, unresponsive state (in terms of its typology) • (4)As in Argentina and Brazil economic progress was not linked to democracy, as economic success linked to authoritarian rule for over 30 years • this model falls in 1997

10. Economic Crisis • In July 1997, shortly after the Thai baht was unpegged from the US dollar, investors and currency speculators, who were either nervous or opportunistic, started to test the "fundamentals" in other Asian countries by selling off stocks, calling in debts and dumping currencies, thus triggering the "contagion" effect which caused currencies and economies throughout the region to collapse. Malaysia, Indonesia and the Philippines were most severely affected, as relentless attacks on their currencies forced each, in turn, to abandon the fixed exchange rate and let the market determine the currency's value. • Middle class assest were wiped out overnight; no level of society escaped the pain • eco crisis resulted in a backlash against Suharto

11. Political Crisis • Suharto’s legitimacy was undermined with the economic crisis, opposition to his rule strengthened quickly • mass rioting ensued, hundreds were killed • Suharto was forced to resign in May 1998 , and Indonesia came full circle • He left the country in economic disarray much like how he found it

12. Political transition • The 1999 election marked the first free election since 1955, 46 parties competed. • Calls for democracy during the economic crisis, but the general citizenry were more concerned with the price of staples than larger visions of democracy. One reporter suggested that many Indonesians did not care who won as long as they make it easier to buy rice, reflecting how the price of basic foods have risen since the Asian eco crisis. “The price of food is the single greatest concern of ordinary Indonesians, much closer to their hearts than any strong desire to reform the political process.”

13. Democratic Transition • This ties into the concept of political culture, particularly after being subject to an authoritarian regime for more than 32 years most ordinary Indonesians would not have a meaningful conception of democracy. If democracy was not entrained into their political culture than it would not be able to surface. • Thus, the authoritarian regime may have caused an authoritarian political culture, as few citizens had any understanding of meaningful political competition • Democracy, thus, may have been seen as more of a means to an end (economic success) than an end in itself.

14. The Complications of transition • military- still holds a significant degree of power, particularly because it is still politicized. It is thought that they gave the new President Wahid its 38 votes in parliament, therefore he may now feel he owes them something. Arguably, democracy can not be fully realized with solders holding seats in parliament, or until the president places the solders under civilian control. • Ethnic politics- As a country with 200,000 people speaking 250 languages and representing 300 different ethnicity's society has become increasingly divided since Suharto’s fall. His authoritarianism held the various elements together, as he was able to repress the vast differences among citizens. In the past 12 months, as many as 2000 have been killed in surges of religious warfare. (Muslim v. Christian • “Few people here have any understanding of healthy political or social competition. For some of them democracy means chaos and killing”