Modern Indonesia

1 Introduction
2 Politics in the post-Suharto era
3 The army in Indonesian politics
4 Disintegration?
5 Gus Dur tried to put it back together
6 Domestic hangovers and international relations

The last few years have seen a transformation in Indonesia's economic and political landscape. No commentator was sufficiently prescient to foresee these changes, and no one knows where, ultimately, they will lead. For the first time since the attempted coup of 1965, Indonesia is entering truly uncharted territory. The chronically pessimistic see Indonesia fragmenting and the economy continuing to bump along the bottom as political instability prevents investor confidence returning. Optimists see stability returning in a brighter post-East Timor/post Suharto era, and economic and investor confidence with it. With Aceh seemingly on the road to quasi or full independence, Irian Jaya clamouring for more autonomy, and resource-rich provinces like Riau and East Kalimantan demanding a larger slice of the pie, the central government in Jakarta is finding it almost impossible to keep people happy.

From 1965 through to 1998, Indonesia was under the control of a military-bureaucratic elite led by President Suharto. Power was exercised through Sekber Golkar, better known as just Golkar, the state's very own political party. In political terms at least, Indonesia was one of the world's most stable countries. It might not have been rich or powerful, but at least there was continuity of leadership. But in 1998 all that changed. Suharto was forced to resign after bitter riots in Jakarta brought on by the collapse of the Indonesian economy, but fuelled by decades of nepotism and corruption. What began as student protests escalated into communal violence and some 1200 people were killed. The critical Chinese community - central to the operation of the economy - fled the country (for the interim at least) and an already dire economic situation became catastrophic. Suharto's vice president, BJ Habibie, took over the helm, but with scarcely a great deal of enthusiasm from the general populace or from the military. Elections were held on 7 June 1999, the first free elections for 44 years, and they were contested by scores of parties. Megawati Sukarnoputri, former president Sukarno's daughter, won the largest share of the vote through her party PDI-Perjuangan (PDI-Struggle). Even with PDI-P's victory, however, some feared that BJ Habibie would call on the political muscle of Golkar to secure him victory in the presidential elections. But the tragedy of East Timor put paid to that and he had to face the humiliation, in October 1999, of a vote of censure and no confidence in the newly muscular and independent People's Consultative Assembly (Indonesia's parliament).

Politics in the post-Suharto era

On 7 June 1999, Indonesians enjoyed their first truly democratic elections since 1955. Despite dire predictions to the contrary, they were largely peaceful. About 112 million votes were cast - 90% of eligible voters - at 250,000 polling stations around the country. A total of 48 parties contested the poll, 45 of them new, and Megawati Sukarnoputri's Democratic Party of Struggle (PDI-P) won the largest share of the vote, attracting 34% of the total. In second place came Golkar with 22%. This was a surprise to some foreign observers, given the bad press Golkar had received, but reflected the party's links with the bureaucracy and a strong showing in the Outer Islands where 'reformasi' had had less of an impact. The three other parties to attract significant numbers of votes were the National Awakening Party (12%), the National Mandate Party (7%) and the United Development Party (10%).

Indonesia's first taste of democracy since 1955 has led to profound changes in the character of both politics and politicians. In the past, MPs had no constituency as such and so were rarely bothered about the need to represent real people. They merely had to make sure they pleased the party bosses. Members of the new parliament, however, not only have responsibilities to their electorates, but are also likely to be much more outspoken. Because presidents will now have term limits (Suharto was in power for 32 years), this will confer greater power on parliament. As Dan Murphy said in mid-1999 and before the presidential elections, “the next president ... will confront populist and legislative challenges like no one has faced since Megawati's father and Indonesia's first president, Sukarno, dispensed with democracy 40 years ago” (FEER, 19.8.99).

Under former President Suharto,
was, in effect, the state's own party. All state employees were automatically members of Golkar, and during election campaigns the state controlled the activities of other parties. Not surprisingly, therefore, Golkar was able consistently to win over 60% of the votes cast in parliamentary elections, and controlled the Parliament (DPR) and the People's Consultative Assembly. Even before Suharto's resignation in 1998, there was the enduring sense that the tide of history was running against Golkar. The provinces where Golkar did least well were in the country's heartland - like Jakarta and East Java. It was here, in Java, that Indonesia's middle classes and 'new rich' were beginning to clamour for more of a say in how the country was run, and by whom. With Golkar's loss of the elections of 1999 to the PDI-P, the party has come to accept a new and less central role in the country. In the past all bureaucrats were automatically members of Golkar and were expected to support and represent Golkar. This is no longer the case.

But despite the fact that the PDI-P won the 1999 parliamentary elections, there were commentators who did not think that Megawati, the party's leader, would become president. Prior to the East Timor debacle, some feared that BJ Habibie would ally himself with one or two other parties and use Golkar to gain the presidency against the run of votes. That assumption was shattered when it became clear that the people of East Timor would vote for independence. But Habibie's mistake was not that he failed to control the army and the militias, but that he was foolish enough to offer the East Timorese a referendum on independence in the first place.

In October 1999 the People's Consultative Assembly voted for Indonesia's new president - and it was a cliffhanger. Indonesians could watch - another first for the country - democracy in progress as their representatives lodged their preferences. It was a close contest between Megawati Sukarnoputri, the people's favourite, and the respected
Abdurrahman Wahid
, an almost blind cleric and leader of the country's largest Muslim association, the Nahdlatul Ulama (NU), and a master of the politics of appeasement; a quality which in the President of such a diverse nation can stymie progress and blunt his effectiveness. As it turned out, Wahid won by 373 votes to 313 as he garnered the support of Golkar members and many of those linked to Muslim parties. Initially, Megawati's vociferous and easily agitated supporters rioted when they realized that their leader had been, as they saw it, robbed of her democratic entitlement. Wisely, Wahid asked Megawati to be his vice-president and she asked her supporters to calm down and return home. The election of Wahid and Megawati was, arguably, the best combination that could have been hoped for in the circumstances. It allied a moderate with a populist, and it kept army commander-in-chief General Wiranto out of the two leadership spots (although he was asked to join the cabinet). Wahid's cabinet, announced a few days after the election, showed a desire to calm tensions and promote pragmatic leadership. Significantly, he included two Chinese in his cabinet (one, the critical finance minister), as well as one politician from Aceh and another from West Papua - the two provinces with the greatest secessionist inclinations. On his election to the presidency, four critical questions faced Indonesia's new president. First, how to mend the economy; second, how to keep the country from disintegrating; third, how to promote reconciliation between the different racial and religious groups; and fourth, how to invent a role for the army appropriate for a democratic country entering the 21st century.

Indonesia has changed in other ways - although these changes could be reversed should the move towards democratization begin to falter. For a start, the judiciary and the press are increasingly independent. During the last few years of the Suharto era, hesitant steps towards greater press freedom were often followed by a crackdown on publications deemed to have crossed some ill-defined line in the sand. The independence of the judiciary was, if anything, an even more vexed issue. Political opponents of Suharto and his cronies could not expect a fair trial, and foreign businessmen found using the courts to extract payments from errant Indonesian businessmen and companies a waste of time. In 1997 a clerk at the Supreme Court was heard explaining to a litigant how Indonesia's legal system worked: “If you give us 50 million rupiah but your opponent gives us more, then the case will be won by your opponent” (quoted in
The Economist
, 2000). This approach to legal contests may have the advantage of simplicity, but it hardly instilled a great deal of confidence that a case would be judged on its merits.

In the six months following Suharto's resignation nearly 200 new publications were registered. The government under Habibie was rather more thick-skinned than its predecessor, and in June 1998 a law permitting the Information Ministry to ban any publication for criticizing the government was scrapped. This move towards greater press freedom in the post-Suharto era has meant a much more active, campaigning and, occasionally, sensationalist press - something that President Wahid has sometimes found rather harder to stomach than did Habibie.

The army in Indonesian politics

It has always been recognized that a critical ingredient - indeed a central element - in Indonesian political life is the army. For many years the army has been viewed as the only group in the country (beyond Golkar) with the necessary cohesion and unity of purpose to influence political events at a broad level. This wider role was enshrined in the constitutional principle of
, or dual function, which gave the army the right to engage in politics and administration, as well as defend the nation from external aggressors and internal insurrection. (This was amply illustrated in the army response to events in East Timor.) According to political scientist Harold Crouch, around two-thirds of army personnel were, under this system, assigned to territorial rather than combat duties. As such they engaged in such things as “overseeing the activities of political parties and non-governmental organizations, intervening in land disputes, [and] dealing with striking workers or demonstrating students...”. In the countryside the army was seen as a stabilizing force and the guarantor of ethnic and religious peace. The army has traditionally regarded itself as the protector of the nation, and more particularly the protector of ordinary Indonesians against potentially venal civilian politicians and their business associates. The key role that the military played in Indonesia's independence movement - after the civilian revolutionary government had capitulated to the returning Dutch after the end of the Second World War - gave it further credibility to speak not just for itself, but also for the country as a whole.

Like so much in Indonesia, these assumptions must be re-examined in the light of Suharto's fall from power, the army's response to the riots of 1998, its role in East Timor, and the democratic elections of 1999. In 1999 the army changed its name from Abri to TNI. This, though, does not detract from the fact that the army has lost credibility, particularly as a result of the way it has dealt with, some would say fermented, sectarian and secessionist conflicts from Jakarta to Aceh, East Timor and Maluku. Moreover, it has become clear that a new generation of officers is in charge. These men, importantly, cannot call on their revolutionary credentials to justify and legitimate their positions and their actions. Moreover, the great unifying message of the 1970s and 1980s - the need to fight communism - no longer carries much influence. (That said, the code ET is still attached to some people's ID cards, designating that they are former political prisoners, and in mid-1999 the Indonesian parliament debated a bill that would have banned the teaching of Marxist-Leninism outside universities.) However, while the army may have a smaller role to play in political and civilian affairs, the police are hardly ready to fill the void created by the retreating army. With just 200,000 poorly trained and paid officers, the police are barely able to keep the peace and in many cases stand idly by while civilian vigilantes mete out justice.


It has long been said that Indonesia is one of the world's most unlikely countries, a patchwork of cultures and languages pieced together by little more than the industriousness of the Dutch. In early 1999 President BJ Habibie, as a sop to the international community, surprisingly offered the people of
East Timor
a referendum on independence. The UN was called in to supervise the vote on 30 August but, against UN advice and pleading, he refused even a small international peacekeeping force. The vote itself proceeded smoothly and with little intimidation. On 4 September the results of the vote were announced: 78.5% of a turnout of well over 90% chose independence. It seems, and this might seem incredible to anyone who has followed the East Timor story, that the Indonesian military were expecting to 'win' the vote and were piqued that the population were so patently ungrateful for all their hard work. So, with the announcement of the results, mayhem broke out. Militias, formed, encouraged, armed and orchestrated by the Indonesian military, murdered, raped and terrorized the population of the tiny province. Tens of thousands fled to the hills and into neighbouring West Timor. (On 13 September one UN official suggested that just 200,000 out of East Timor's 800,000 population were still living in their homes.) Dili was virtually razed to the ground. The UN compound was besieged. Only the most intense international pressure, and vociferously negative international press coverage, forced Habibie to allow the UN
to authorize an Australian-led force to enter the province.

The reluctance of the military to allow East Timor's independence can be linked to two key factors. First, between the annexation of East Timor in 1975 and the referendum of 1999, the army lost perhaps as many as 20,000 men trying to quell the independence movement there. To give up was to admit that it was all a waste of time and blood. And second, and much more importantly, there was the fear that East Timor's independence might herald the break-up of Indonesia. Aceh and Irian Jaya were the most obvious provinces that could break away. Legally speaking, there is a clear difference between East Timor and anywhere else in Indonesia. East Timor's annexation by Indonesia was never recognized by the UN. (UN maps always indicated the territory as a separate country.) But the fear was that this nuance would be lost on people with desires for independence.

The 7500-strong Australian-led UN force landed in Dili in late September 1999 and control of the territory passed from the Indonesians to the UN. Alongside the Aussie troops, there were British Gurkhas, New Zealanders, and even contingents from the region, including Thai and Malaysian troops. (Asean came out of the crisis poorly, yet again showing an inability to act in a timely and forceful manner.) Even as UNIFET (the UN International Force for East Timor) strengthened its hold on Dili, the withdrawal of Indonesian troops destroyed the town they had called their own for nearly 25 years. As one soldier told
The Economist
: “We built this place up. Now we've torn it all down again” (02.10.99). During October, UNIFET extended its control east and west from Dili as far as the border with West Timor where the militias were holed up. Rumours of a militia build-up and possible major incursion did not materialize, although there were some firefights between UNIFET and militia gangs. At the end of October Xanana Gusmao, jailed for 20 years by Indonesia and the most likely person to become East Timor's first president, returned home. Before leaving Australia he said: “We will start from zero to reconstruct not only our country, but ourselves as human beings” (
The Economist
, 16.10.99).

A complication - and another reason why the Indonesian army were so reluctant to give up their hold on this dry and poverty-stricken land - was the decision taken by the UN on 27 September 1999 to investigate human rights abuses in the province. And they were right to be worried. When the UN and Indonesian reports were published at the beginning of 2000, six generals were mentioned by name, including General Wiranto .

It was not just East Timor and Aceh that were wracked by violence. Indeed, the spread of unrest to other areas of the country seemed to bear out the army's fears: that taking the lid off more than three decades of top-down control would lead to an upsurge of violence right across the country. Conspiracy theories abounded as to which interested party was seeding this violence. Some believed that much of the unrest was being orchestrated by the military - anxious to prove that without their control the country would disintegrate. Influential individuals from the Suharto era might have been trying to destabilize the country in order to regain power. As criminologist Yohanes Sutoyo explained to Dini Djalal of the
Far Eastern Economic Review
: “The New Order [of former President Suharto] taught us that the only way to solve a problem is with violence”, adding, “It is difficult to undo this” (FEER 13.07.2000). At the beginning of 2000, communal violence in the Spice Islands of Maluku escalated and by mid-year an estimated 3000 people had been killed. In Central Sulawesi, murderous groups were killing villagers. In central Kalimantan deadly clashes broke out between indigenous Dayaks and migrants from Madura Island, who came as part of the Suharto government's
programme. Bali and Lombok were also the scenes of unprecedented violence at the beginning of 2000, some of it aimed at the Chinese community, many of whom are Christians. In Jakarta, and in some other cities on Java, vigilante groups have taken it upon themselves to mete out retribution on small time criminals. Reports of people stealing bicycles being lynched, beaten, doused with kerosene and set alight were common during 2000. The police, in such cases, stood by, powerless to intervene.

While disintegration, partial or otherwise, is a possibility, the government is in the process of introducing laws that will lead to far-reaching
to try and head off those who would prefer even greater autonomy. But there are worries that this attempt to devolve power to the provinces will permit local power-brokers to dominate affairs and make corruption even worse. It will also mean that poor provinces such as East and West Nusa Tenggara will no longer be able to rely on cross-subsidization by richer provinces such as Riau and Aceh. Furthermore, it is far from clear that there are sufficient numbers of competent people in the provinces to handle such an increase in the power and role of local level government.

Gus Dur tried to put it back together

President Abdurrahman Wahid, better known as Gus (a term of respect) Dur (from his name), did not have an easy task when he assumed the presidency at the end of 1999.

Gus Dur was renowned for his cunning and wily ways - and his fondness for obtuseness. When he was leader of Nahdlatul Ulama (NU), the world's largest Muslim organization, he was one of President Suharto's very few critics. And he was also able to present himself as a moderate Muslim: one who would protect the interests of Indonesia's non-Muslim population while remaining a respected Muslim cleric, leader and thinker. In January 2000 he travelled to Saudi Arabia to court the Arab world and then flew to Davos in Switzerland for the World Economic Forum. Here he met with Prime Minister Barak of Israel and George Soros. He explained: “We need investments and, you know, the Jewish community everywhere are very active in the commercial side ...” (FEER 10.02.2000). His critics said he undermined Indonesia's stability and economic recovery by his impulsiveness; he frequently made statements without consulting his cabinet (as happened when he said, while on an overseas trip, that General Wiranto should resign) and people also complained of his readiness to blame conspirators for the country's problems. His supporters believed he was a great master who disarmed his opponents by his seeming foolishness, before bringing them down. With few political cards to play, once many in his coalition government turned against him, his defenders believed that speaking out was his only weapon. Without the backing of a fully functioning bureaucracy, or the military power used by his predecessor, his force of personality and ability to bluff were the only tools at his disposal.

His greatest victory, or so it seemed at the time, was to sideline the army and emasculate its leadership as a political force. This also showed him at his wily best. Initially, Wahid included General Wiranto, the army's powerful chief of staff, in his cabinet, but not, significantly, as defence minister. Instead he appointed him as security minister. This helped to separate the General from his power base. Then the president said that he would sack anyone implicated in human rights abuses in East Timor. Reports commissioned by the Indonesian government and by the UN into just this issue were released on 31 January 2000. Moreover, both came to the same conclusion: that members of the Indonesian army had assisted the militias in East Timor to murder, rape and pillage. More to the point, the Indonesian report mentioned six generals by name, including General Wiranto. The president was abroad at the time but in an interview said he thought that Wiranto should resign. Instead the General pointedly turned up at a cabinet meeting. However, having initially said that the General could stay, he changed his mind once more and sacked the general from his post as security minister (although he remained an 'inactive' member of the cabinet). Cut off from the army and in a government post with no significance, General Wiranto was successfully trapped in a no man's land of Gus Dur's making.

But Wahid did not just get rid of Wiranto. He appointed a civilian as minister of defence and promoted officers in the navy and airforce to influential positions, thus downgrading the traditionally highly dominant army. This culminated in a major reshuffle at the end of February 2000. Furthermore, Wahid insisted that military men in the cabinet had to resign from their military posts before taking up their political appointments.

While Gus Dur sidelined the army, he didn't counted on the public taking up arms to deal with the problems of the nation (probably orcestrated from above - possibly by factions of the army). At the beginning of 2000, as Muslim-Christian violence in Maluku escalated, radical Muslims in Java began to prepare for a
(holy war) in this far-flung province. White-robed warriors in their thousands, some wielding swords, congregated in Jakarta to make their feelings clear - and then began to train for battle. Despite Gus Dur's attempts to stop them leaving for Maluku, they began to arrive in the region by the end of May 2000. As the year wore on it became increasingly clear that Wahid's victory over the generals was a pyrrhic one. Infuriated by the president's actions, the army began to undermine his leadership. In particular, a series of bombings in Jakarta would seem to involve the army, or groups in the army. By the end of 2000 the army seemed to be clawing back power.

During the course of 2000, many people who initially welcomed Wahid's accession to the presidency became increasingly disenchanted with his leadership - and with his methods. In an attempt to address this mounting criticism, he proposed far-reaching changes to the management of state affairs. In effect he proposed a more equal, four-way sharing of power between his marginalized Vice President Megawati Sukarnoputri, two new 'Coordinating' ministers, and himself. The two coordinating ministers were later announced as being Sulsilo Bambang Yudhoyono, a retired general, and Rizal Ramli. Significantly, neither of these two men had prior links with any political party. Under this system Wahid would become, in effect, Indonesia's face to the wider world: a sort of roving ambassador for the country. Wahid claimed in the speech that he was ceding 'duties and not authority', but the distinction was a fine one.

Wahid's proposed changes were tacit acceptance on his part that he had lost his way. It sometimes seemed, in the months leading up to the August 2000 meeting, that Wahid lacked the clarity of mind to address key issues, and especially those of an economic flavour. His woolly pronouncements and tendency to prevaricate exasperated many businessmen and foreign investors.

Towards the end of 2000, Indonesia continued to lurch from crisis to crisis, both economically and politically. President Abdurrahman Wahid became increasingly embattled as his problems mounted. In particular, he seemed to have lost control of the army and the police who were, apparently, ignoring or going against his orders. This extended from his order for the army and police to crack down on the militias in West Timor (following the murder of three UN personnel there); to his demand that Tommy Suharto, one of former President Suharto's sons, be arrested in connection with a spate of bombings in Jakarta (the police released him saying there was not sufficient evidence); to a ceasefire in the northern Sumatran province of Aceh, which the army also apparently chose to ignore. Some commentators wondered whether the army was once more out of control and it was even suggested that Wahid could be toppled by an army-inspired coup.

Domestic hangovers and international relations

Indonesia's acceptance into the international fold has been hampered for years by numerous small and large stumbling blocks. The 'occupation' of East Timor, government policy in Irian Jaya, corruption, the nature of the political system, the failure to respect labour rights, and the human and environmental impacts of the transmigration programme, to name just a few. Just when Indonesia is on the verge of expunging the stain on its credibility, one or more of these issues jumps out and progress is stymied.

There can be no doubt that the major stumbling block was East Timor. Even before the tragic events which followed the vote for independence in mid-1999, East Timor was a thorn in Indonesia's attempts to punch its weight. (For a country of over 200,000,000 people, the fourth most populous on earth, it has a remarkably low international profile.) Nationalist sentiment was stoked by the presence of UN forces in East Timor (widely seen to be Australian forces in East Timor), and Indonesia's failure to come to terms with its misguided imperialist spree raised the stakes still further. At the end of September 1999, US Secretary of Defence William Cohen warned that Indonesia could face 'political isolation' and 'economic consequences' if it did not control its military.

Large chinks began forming in the armour of Wahid's popular support. In 2001, as he pushed for further reconciliation with separatists in Papua and Aceh, martial law was imposed in Maluku as fighting between Christians and Muslims intensified. It was discovered that the government ordered the military to block all members of Laskar Jihad (an Islamist group made up of Muslims from across the archipelago) from travelling to Maluku to fight. Not only did the military fail to do this, it soon became clear that Laskar Jihad was being funded by the Indonesian military. Things got worse for Wahid when he became embroiled in two huge financial scandals involving large sums of money that went missing from the State Logistics Agency (the money - US$4 million - was found with Wahid's masseur) and from a donation given by the Sultan of Brunei.

After legalising the use of Chinese characters and making Chinese New Year a national holiday in January 2001, Wahid declared at a meeting of university rectors that if Indonesia fell into a state of anarchy, he would be forced to consider dissolving the DPR (House of Representatives), a remark that won him few friends. At a special convening of the DPR a memorandum was signed against Wahid. A second would force a Special Session in which the impeachment and removal of a president would be a legal action. The writing was on the wall for the President and in April as his NU (Nahdlatul Ulama - Wahid's Islamic group) offered to fight to the end in support of their president, it seemed as though the nation was again slipping into grave civil strife. A second memorandum against Wahid was written after he sacked two members of his own cabinet as dissidents. Wahid was growing desperate and demanded that Susilo Bambang Yudhyono (then Minister for Security) call a state of emergency, a request which was refused. The date of MPR (People's Consultative Assembly) session for the impeachment of Wahid was hurried forward and the Indonesian army rallied against the president, flooding Jakarta with troops and aiming their tanks at the presidential palace. The MPR declared the end of Wahid's term as president, which he initially refused to accept, before finally conceding and slipping off to the USA for medical reasons.

In July 2001 Megawati Soekarno-Putri took over the reigns of power. She was seen to take a very passive role, enjoying her status as a daughter of the cult figure and founding father of Indonesia, Soekarno. It was noted by critics that she seemed more interested in developing her hobbies of gardening and watching cartoons than intervening in government business. Three years after she had taken power, elections were called and although the economic situation had improved slightly, rates of poverty and unemployment remained high. It was during her reign that terrorists struck foreign targets Bali and Jakarta, prompting falling confidence from foreign investors and once again thrusting Indonesia into the international headlines for all the wrong reasons. Megawati lost the election to Susilo Bambang Yudhyono (SBY), and quietly left the palace.

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