After Suharto

suharto resigns



Today, 16 years ago, one of Asia’s longest-running Western-backed dictators announced his resignation, ending a three-decade authoritarian rule in Indonesia, the world’s fourth most populous nation. It started with a savage pogrom; Suharto, assisted by CIA, launched an anti-Communist mass extermination campaign, killing 1-3 million civilians from 1965 to 1966. It ended, also, with another bloody wave of revolution; massive student protests, a brutal military crackdown, and afterwards, riots against ethnic Chinese, killing in between 1,000 and 5,000 people.

Then Indonesia undergoes through Reformasi, a political experimentation set on democratizing the country, and also eliminating all the elements of cronyism and corruption, the two things that used to sustain his rule as well as Indonesia’s fast-paced economic growth for three decades. Three direct elections have been scheduled, four presidents have followed through, and the nation, once economically devastated by the impact of 1997 Asian financial crisis (which obviously exposed how fragile the nation’s financial strength was, in particular due to corruption and shadow banking), again rebounds. GDP has surpassed 1 trillion US$, 100 million Indonesians have entered either middle or lower-middle class, and optimism has once again spread.

But, in this post-Suharto era, as well, Indonesia has lost one important element the dictator once used to preserve so well: stability. Islamic fundamentalism is on its rise. Corruption, rather than centralized in Jakarta, has instead been absorbed in hundreds of new regencies and cities formed in the wake of mass autonomy, and as a consequence, local dynasties, or the ‘mini-Suhartos’, have mushroomed across the nation. The Economist even warns us that our global crony-capitalism rank has increased significantly, from 18 in 2013, to 10 this year. Political configuration turns out to be even more helter-skelter than it once was in New Order. And all these, in current times, are inevitable.

Pankaj Mishra, an Indian novelist, tries to examine in details the post-Suharto Indonesian society in his essay in London Review of Books. Read it, and rethink.




Under Suharto, Indonesia’s economy grew on average 6.5 per cent per annum for thirty years before contracting by 13.6 per cent in 1998. A culture of bribes and extortion flourished, but it wasn’t incompatible with high growth. Development subsidies from the West and Japan ensured a rise in living standards even before Indonesia turned into an export-oriented country. An oil boom starting in the 1970s helped; rural incomes were boosted by the introduction of high-yield rice varieties; literacy rates, which had been abysmal, rose. Monopolies in cement, oil, timber, telecommunications, media and food were enjoyed by an indigenous business class that included Chinese-Indonesians as well as members of Suharto’s family (he didn’t trust other Indonesian business families). Local companies were allowed to make deals with multinationals; ExxonMobil moved into Aceh to operate its gas fields; Freeport and Rio Tinto acquired mining rights in Papua. Military rule opened the floodgates for the corporate class, and small windows to the middle class. Many salary-earners and members of the urban petite bourgeoisie supported Suharto (they’re the ones mourning the demise of his ‘stable’ regime), whose Golkar party ensured that some of the loot trickled down to low-level officials. Even conservative Islam was eventually brought into his patronage networks.

That was what Suharto wanted: a population divided by individual pursuit of food, wealth and status was the basis of his regime’s stability. It was also what finally tripped him up. Having entered the age of financial capitalism early, debt-laden Indonesia was also among the first to be exposed to its hazards. The currency lost nearly 80 per cent of its value in the wake of the crisis of 1997; per capita income collapsed; banks imploded; millions lost their jobs. The foreign investors who had been underwriting Suharto’s economic ‘miracle’ made themselves scarce. The IMF stepped in with its usual ‘rescue package’ of subsidy cuts, which led to food riots. A widely circulated photograph of the IMF director Michel Camdessus, arms crossed, looming over a seated and clearly supplicant Suharto recalled the humiliations of the colonial era.


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