Upheaval: Turning Points for Nations in Crisis

by Jared Diamond

  In contrast to Sukarno, Suharto did not pursue Third World anti-colonial politics and had no territorial ambitions outside the Indonesian archipelago. He concentrated instead on Indonesian domestic problems. In particular, Suharto ended Sukarno’s armed “confrontation” with Malaysia over Borneo, rejoined the United Nations, abandoned Sukarno’s ideologically motivated alignment with Communist China, and aligned Indonesia instead with the West for economic and strategic reasons.

  Suharto himself lacked a university education and had no understanding of economic theory. Instead, he placed Indonesia’s “official” economy (in contrast to the unofficial economy described below) in the hands of highly qualified Indonesian economists, many of whom had obtained degrees at the University of California at Berkeley. That resulted in the nickname of “the Berkeley mafia.” Under Sukarno, the Indonesian economy had become saddled with deficit spending resulting in heavy debt and massive inflation. Like General Pinochet’s Chicago Boys in Chile, Suharto’s Berkeley mafia instituted economic reforms by balancing the budget, cutting subsidies, adopting a market orientation, and reducing Indonesia’s national debt and inflation. Taking advantage of Suharto’s abandonment of Sukarno’s left-leaning policy, the Berkeley mafia encouraged foreign investment and attracted American and European aid for developing Indonesia’s natural resources, especially its oil and minerals.

  Indonesia’s other body of economic planning was the military. Suharto declared, “The armed forces have a great interest in the process of modernizing the state and society, and wish to play a vital role in its process.… If the army stands neutral in the face of problems in consolidating the New Order, it disavows its role as well as the call of history.… The military has two functions, that is, as an armed tool of the state and as a functional group to achieve the goals of the revolution.” Just imagine an American general becoming president, and saying that about the U.S. army! In effect, the Indonesian military developed a parallel government with a parallel budget approximately equal to the official government budget. Under Suharto, military officers constituted more than half of Indonesia’s mayors, local administrators, and provincial governors. Local military officers had the authority to arrest and hold indefinitely anyone suspected of actions “prejudicial to security.”

  Military officers founded businesses and practiced corruption and extortion on a huge scale, in order to fund the military and to line their private pockets. While Suharto himself did not conduct an ostentatiously lavish lifestyle, his wife and children were reputed to practice enormous corruption. Without even investing their own funds, his children launched businesses that made them rich. When his family was then accused of corruption, Suharto became angry and insisted that their new wealth was just due to their skills as business people. Indonesians gave to Suharto’s wife (Ibu Tien = Madam Tien) a nickname meaning “Madam Ten Percent,” because she was said to extract 10% of the value of government contracts. By the end of Suharto’s reign, Indonesia was ranked among the most corrupt countries in the world.

  Corruption pervaded all aspects of Indonesian life. For instance, while I was working in Indonesia for the international environmental organization World Wildlife Fund (WWF), an Indonesian friend also working for WWF pointed out to me an Indonesian WWF office director and whispered that his nickname was “Mr. Corruption”—because he was not just normally corrupt, but exceptionally corrupt; a boat that overseas WWF donors had bought for that particular WWF office had ended up as a private boat of Mr. Corruption. As another example of non-governmental corruption, my work in Indonesia routinely required me to fly with heavy luggage that incurred excess baggage charges. I became accustomed to the fact that, whenever I checked in at the counter of an Indonesian domestic airport, the airline check-in employees came out to me from behind the counter and demanded the excess baggage charges in cash for their own pockets, not for the airline.

  Suharto replaced Sukarno’s governing principle of “guided democracy” with what came to be known as the “New Order,” which supposedly meant going back to the pure concepts of Indonesia’s 1945 constitution and to the five principles of Pancasila. Suharto claimed to be stripping away the bad changes subsequently introduced by Indonesia’s political parties, for which he had no use. He considered Indonesian people to be undisciplined, ignorant, susceptible to dangerous ideas, and unready for democracy. In his autobiography he wrote, “In Pancasila democracy there is no place for a Western-style opposition. In the realm of Pancasila democracy, we recognize musyawarah [deliberation] to reach the mufakat [consensus] of the people… we do not recognize opposition as in the West. Here we do not recognize opposition based on conflict, opposition which is just trying to be different.… Democracy must know discipline and responsibility, because without both those things democracy means only confusion.”

  These Suharto leitmotivs—that there is only one way, and that there should be no disputes—applied to many spheres of Indonesian life. There was only one acceptable ideology, Pancasila, which civil servants and members of the armed forces had to study under a bureaucratic indoctrination program. Of course, labor strikes were forbidden: they were contrary to Pancasila. The only acceptable ethnic identity was uniformly Indonesian, so Chinese Indonesians were forbidden to use Chinese writing or to keep their Chinese names. National political unity admitted no local autonomy for Aceh, East Timor, Indonesian New Guinea, or other distinct regions. Ideally, Suharto would have preferred just one political party, but parliamentary elections contested by multiple parties were necessary for an Indonesian government to appear legitimate on the international scene. However, a single government “functional group” named Golkar always won elections with up to 70% of the vote, while all other political parties were merged into two other functional groups, one of them Islamic and the other non-Islamic, which always lost elections. Thus, Indonesia under Suharto came to be a military state, much as it was in the last decade of Dutch colonial government—with the difference that the state was now run by Indonesians, rather than by foreigners.

  The historical display that I saw in the Indonesian hotel lobby in 1979 reflected Suharto’s emphasis on the aborted 1965 coup as a Communist Party plot, portrayed as the defining moment in modern Indonesian history. At the huge Pancasila Monument erected in 1969 to commemorate the killings of the seven generals (Plate 5.5), considered “seven heroes of the revolution,” a solemn ceremony of remembrance and of re-dedication to Pancasila was (and still is) held each year. A bas-relief on the monument and an adjacent Museum of PKI Treason depict the history of post-colonial Indonesia as a sequence of treasonous communist acts culminating in the 1965 coup attempt. On September 30 every year, all Indonesian TV stations were required to broadcast, and all Indonesian schoolchildren were required to watch, a grim four-hour-long government-commissioned film about the seven kidnappings and killings. There was of course no mention of the half-a-million Indonesians killed in retaliation. Not until a dozen years later, in the year (1979) when I began to work in Indonesia, were most political prisoners finally released.

  Indonesia’s parliament reelected Suharto as president for one five-year term after another. After nearly 33 years, just after parliament had acclaimed him as president for a seventh five-year term, his regime collapsed quickly and unexpectedly in May 1998. It had been undermined by a combination of many factors. One was an Asian financial crisis that reduced the value of Indonesia’s currency by 80% and provoked rioting. Another was that Suharto himself, at age 77, had grown out of touch with reality, lost his political skills, and was shaken by the death in 1996 of his wife, who had been his closest partner and anchor. There was widespread public anger at corruption and at the wealth accumulated by his family. Suharto’s own successes had created a modern industrialized Indonesian society, whose citizens no longer tolerated his insistence that they were unfit to govern themselves. The Indonesian military evidently concluded, as had the Chilean military after the “No!” vote of 1998, that it couldn’t stop the wave of p
rotests, and that Suharto (like Pinochet) should resign before the situation got out of control.

  In 1999, the year after Suharto’s fall, Indonesia carried out its first relatively free elections in more than 40 years. Since then, Indonesia has had a series of elections with voter turnouts far higher than voter turnouts in the U.S.: turnouts of 70%–90%, whereas voter turnouts in the U.S. barely reach 60% even for presidential elections. In 2014 Indonesia’s latest presidential election was won by an anti-establishment civilian, the former mayor of Jakarta, Joko Widodo, whose defeated opponent was an army general. Corruption has decreased, and sometimes it gets punished.

  Let’s summarize the Suharto regime, and the legacies of the crisis provoked by the 1965 failed coup attempt and the successful counter-coup. The bad legacies are obvious. Worst are the mass murder of half-a-million Indonesians, and the imprisonment of a hundred thousand for more than a decade. Massive corruption reduced Indonesia’s rate of economic growth below the level that it would have enjoyed if so much money had not been diverted into the pockets of the military, running its own parallel government with a parallel budget. That example of corruption was widely imitated through Indonesian society (even by airline clerks). Suharto’s belief that his subjects were incapable of governing themselves postponed for several decades the opportunity for Indonesians to learn how to govern themselves democratically.

  From the events of 1965, the Indonesian armed forces drew the lesson that success would be achieved by using force and killing people, rather than by solving problems that make people dissatisfied. That policy of murderous army repression has cost Indonesia dearly in Indonesian New Guinea, in Sumatra, and especially on the eastern Indonesian island of Timor, which had been divided politically between a Portuguese colony in the east and Indonesian territory in the west. When Portugal was shedding its last colonies in 1974, all geographic logic argued for East Timor becoming another province of Indonesia, which already accommodated so many provinces with different cultures, languages, and histories. Of course one can object that national boundaries aren’t shaped just by geographic logic: Canada isn’t part of the U.S., and Denmark isn’t part of Germany. But East Timor isn’t comparable to Canada or Denmark: it’s just the eastern half of one small island in a long chain of many islands, all the rest of which are wholly Indonesian. Had the Indonesian government and army displayed even a minimum of tact, they might have negotiated an arrangement to incorporate East Timor with some autonomy into Indonesia. Instead, the Indonesian army invaded, massacred, and annexed East Timor. Under international pressure, and to the horror of the Indonesian army, Indonesia’s President Habibie, who succeeded Suharto, permitted a referendum on independence for East Timor in August 1999. By then, the population of course voted overwhelmingly for independence. Thereupon, the Indonesian army organized pro-Indonesia militias to massacre yet again, forcibly evacuated much of the population to Indonesian West Timor, and burned most of the new country’s buildings—to no avail, as international troops restored order and East Timor eventually took control of itself as the nation of Timor-Leste. The costs to the East Timorese were that about one-quarter of the population died, and that the survivors now constitute Asia’s poorest mini-nation, whose per-capita income is six times lower than that of Indonesia. The costs to Indonesians were that they now have in their midst a separate nation with sovereignty over a potentially oil-rich seabed whose revenues will not flow to Indonesia.

  Now that we’ve dwelt on those appalling legacies of the Suharto regime, it may seem that there is nothing further to be said about it. But history rarely presents us with either pure evil or pure good, and history should be reviewed honestly. Hideous as it was in other respects, the Suharto regime did have positive legacies. It created and maintained economic growth, even though that growth was reduced by corruption (Plates 5.6, 5.7). It attracted foreign investment. It concentrated its energy on Indonesia’s domestic problems, rather than dissipating it on world anti-colonial politics or on the effort to dismantle neighboring Malaysia. It promoted family planning, and thereby addressed one of the biggest fundamental problems that have bedeviled independent Indonesia as well as the previous Dutch colonial regime. (Even in the most remote villages of Indonesian New Guinea, I saw government posters describing family planning.) It presided over a green revolution that, by providing fertilizer and improved seeds, greatly increased the yields of rice and other crops, thereby massively raising agricultural productivity and Indonesians’ nutrition. Indonesia was under great strain before 1965; today, Indonesia shows no imminent risk of falling apart, although its fragmentation into islands, territorial extent of thousands of miles, hundreds of indigenous languages, and coexistence of religions were all recipes for disaster. Eighty years ago, most Indonesians didn’t think of themselves as Indonesians; now, Indonesians take their national identity for granted.

  But many people, Indonesians and non-Indonesians, give the Suharto regime zero credit rather than some credit. They object: Indonesia might have made those same advances under a regime other than Suharto’s. That’s a historical “what if?” question, but such questions can’t be answered with confidence. One can only compare what actually did happen in Indonesia after 1965 with what might have happened under the only two available alternatives: continuation of the Sukarno regime that was in power until 1965, or its replacement by a communist regime under the PKI that was seeking to take power. On the one hand, the Sukarno regime had brought Indonesia to political chaos and economic standstill as of 1965. The tortures, killings, grinding poverty, and insane policies associated with communist dictatorships in Cambodia, North Korea, and other countries warn us that a communist alternative to Suharto could have been worse for Indonesia than was Suharto. On the other hand, there are people who argue that Sukarno’s regime was leading to something wonderful, or that an Indonesian communist regime under the PKI would have proved different from communist regimes elsewhere in the world. We’ll never know.

  How does Indonesia’s crisis fit into our framework that contrasts national crises with individual crises?

  Indonesia does illustrate selective change, and the drawing of a fence (factor #3, Table 1.2). Within the fence were major areas considered ripe for change. Those areas included Suharto’s replacement of civilian government by a military dictatorship, the reverse change by his successors, Suharto’s embracing of Western-trained economists to replace economic regression with economic growth, and Suharto’s abandonment of Sukarno’s aspirations to Third World political leadership. On the other hand, outside the fence lay major features of Indonesia that were preserved intact after 1965, including national territorial integrity, considerable religious tolerance, and a non-communist government. Those continuities were considered non-negotiable core values by Sukarno and by Suharto and by Suharto’s successors, except for Sukarno’s willingness to align himself with communists.

  Some factors in Indonesia made it difficult for the country to solve its problems. As a newly independent ex-colony, Indonesia began with only limited national identity (factor #6)—unlike Finland, which had already enjoyed considerable autonomous self-government for a century before it achieved independence. As a new country, Indonesia could not draw confidence from a previous history of successful change, except for its independence struggles of 1945–1949 (factor #8). Honest realistic self-appraisal (factor #7) was deficient in President Sukarno, who believed himself endowed with a unique ability to interpret the unconscious wishes of the Indonesian people. The core values of many or most officers of the Indonesian military were ones that they were willing to kill for, but not to die for (factor #11). Indonesia’s freedom of action was limited by the internal constraints of poverty and of population growth (factor #12).

  On the other hand, Indonesia also enjoyed advantages in solving its problems. As an island archipelago, it enjoys freedom from external constraints, like Chile and unlike Finland: there has been no nation that threatens Indonesia since the departure of the Dutch (fact
or #12 again). Berkeley’s mafia of economists was able to draw on models well tested in other countries in order to reform the Indonesian economy and achieve economic growth (factor #5). After Suharto abandoned his predecessor’s pro–Communist China foreign policy and adopted a pro-West policy, Indonesia received a great deal of investment and foreign aid from Western countries in rebuilding its economy (factor #4).

  Suharto did often illustrate honest, realistic, Machiavellian self-appraisal (factor #7). In gradually pushing aside Indonesia’s popular founding father and first president Sukarno, Suharto proceeded cautiously, figured out at each step what he could get away with and what he couldn’t get away with, and eventually succeeded in replacing Sukarno, even though it took time. Suharto was also realistic in abandoning Sukarno’s foreign policy ambitions beyond Indonesia’s means, including guerrilla warfare against Malaysia and the attempt to lead a world anti-colonial movement.

  Indonesia also illustrates three issues about national crises that do not arise for individual crises. Like Chile but unlike Finland, Indonesia illustrates the breakdown of political compromise that produced the log jam and secessionist movements of the early 1950’s, leading to Sukarno’s installation of “guided democracy,” then to the Indonesian Communist Party calling for arming the workers and peasants, which led in turn to the army responding by committing mass murder. Also like Chile but unlike Finland, Indonesia illustrates the role played by unusual leaders. In the case of Indonesia, those were Sukarno, blessed by charisma and cursed by overconfidence in that charisma; and Suharto, blessed by patience, caution, and political skills, and cursed by his policy of murderous cruelty, by his blindness to the corruption of his own family, and by his lack of faith in his own countrymen. Finally, as for reconciliation after killings provoked by the breakdown of political compromise, Indonesia stands at the opposite extreme from Finland, with Chile intermediate: rapid reconciliation in Finland after the Finnish Civil War; much open discussion and trials of perpetrators in Chile, but incomplete reconciliation; and very limited discussion or reconciliation, and no trials, in Indonesia. Factors responsible for Indonesia’s lack of trials include the country’s weak democratic traditions; the fact that post-Pinochet Chile’s motto “a fatherland for all Chileans” found less echo in post-Suharto Indonesia; and, most of all, that Indonesia remained a military dictatorship for 33 years after the mass killings, and that the armed forces remain much more powerful in Indonesia today than in Chile.