You can learn everything you need to know about Indonesia's problems by catching a blue taxi when you arrive at Jakarta airport and then riding into town to the Grand Hyatt Hotel. The taxi company is owned by one of President Suharto's children, so too are the toll roads that you have to pass through to get from the airport to Jakarta and so too is the Hyatt. Nice roads. Nice tolls. Nice hotel.
It's no wonder that Indonesians say the Suharto family is so lucky. They have everything in the world. Except one thing - a sense of shame.And it is that lack of shame that finally caught up with them. When Indonesia was booming there was just enough growth and corruption spilling over the top of the glass to keep Indonesia in some kind of balance. But the minute the boom slowed, and the glass became half full, the game couldn't go on.
The gap between the haves and the have-nots became too wide. And the only way to refill the glass was with painful economic reform and institution building. And the only way to do that was for Suharto to say to his people: "Friends, we've got to tighten our belts. We're all in this together." And when he tried that last week, the answer came back in a violent spasm: "President, we all weren't in the toll roads and taxi companies together."
The recent U.S. approach to Indonesia was based on a false premise: that our only choices were either supporting Indonesia economically, even though this might be exploited by Suharto to prolong his 32-year reign, or letting the country slide into chaos by withholding IMF assistance. The United States thought that demanding political change was not an option.
Wrong. There will be no stability in Indonesia - economic or otherwise - without fundamental political change. The only question now is whether political change in Indonesia is directed by Suharto as his last act or simply explodes from below.
If the United States wants to use economic aid through the IMF as an incentive for Suharto to immediately begin the political transition, that's fine. Because, unfortunately, Suharto has so decimated every other institution and potential political actor in the country that there is a vacuum under him. But the U.S. message to him has to be blunt: "Convene an assembly to re-write Indonesia's 1945 Constitution, establish a real parliament with real opposition parties, not the rubber stamp Indonesia has now - and then be gone."
But if Suharto will not direct this political transition now, or if it's too late, then the United States has to completely disengage from him, because he's toast. Indonesia, Thailand and Korea were like 50-watt bulbs in the 250-watt socket of the global market. When the power surge came from that market last fall, these three bulbs blew up.
But Thailand and Korea, precisely because they were democracies, were able to begin adjusting by voting in new surge protectors and software. That is, more democratic leaders and the beginnings of institutional reform - with popular support. Indonesia, because it is a corrupt autocracy, couldn't just vote in new software and new institutions, and that's why it's melting down.
There was a time when we thought we had to tolerate the Suhartos as a bulwark against communism, which was THE strategic issue. No more. The relevant issue today is how your country relates to the opportunities and challenges of the global market - whether you are building law-based institutions that enable you to get the most out of that global market and the institutional software to modulate its ups and downs.
Therefore it is a prime interest of U.S. foreign policy to help countries face up to this challenge - to help them become open enough and internally strong enough to both tap the global marketplace and protect themselves from it.
The big split in the world today is no longer between centrally planned communist regimes and free-market democracies. Rather, it's between free-market kleptocracies (Mafia regimes) and free-market democracies. Those building the institutional software, and those who aren't. U.S. foreign policy should be devoted to helping the free-market democrats and stifling the free-market kleptocrats.
The Suhartos are kleptocrats. As long as they remain, Indonesia will be unstable because the Suhartos are a bulwark against the very reforms needed for Indonesia to thrive in this new era.
New York Times News Service