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Comment on Indonesia

We present here (in wide page format) two parallel comments on the current state of play between the United States and Indonesia:

  • on the left, one by a foreign affairs scholar, Theodore Friend,
  • and on the right (be sure to scroll to the right side of your screen), one by a former senior career diplomat, Ronald Palmer,

— this in line with our aim to promote an ongoing intellectual exchange on issues in American diplomacy.
~ Ed.

Indonesia On Fire
Washington All Wet?

By Theodore Friend*

The United States and Indonesia, the third and fourth most populous countries in the world, barely know each other. They behave in ways mutually difficult to understand. Until now, their national gaps of perception and feeling, of policy and action, have not been especially hurtful to either, or to any other power. But sustained misunderstandings, notably from the American Congress, could lead to disastrous clumsiness in a future Indonesian crisis, or in a crisis more general to the Pacific Rim.
Before Sukarno fell in 1966, a common mortar of anti-communism held Indonesia and the USA together for a quarter century. Now, however, America, as winner of the Cold War, continues to waltz with itself in a trance of victory. Meanwhile, the Indonesian government persists in fighting internal subversion with Cold War labels. A muddy paste of anti-Marxism helps the government hold together twenty-seven provinces and hundreds of ethnic groups and to suppress its increasingly fractious urban populations.
Even while the Cold War was wearing itself out, Washington remained in a strong consultative position with Jakarta through membership on the Inter-Governmental Group on Indonesia (IGGI). And in those days, American military were still on personal terms with young Indonesian warrior- leaders through the International Military Education and Training program (IMET). But now, neither.

IGGI, a consortium of North Atlantic donor nations plus Japan, came to the rescue of an Indonesia suffering from civil mayhem and enduring an average per capita income of $70 per year. It provided advice and channeled aid through a highly educated and motivated segment of the Indonesian upper bureaucracy, who guided long-range macro-economic policy. Growth in the Soeharto period, as a result, averaged seven percent for the twenty-five years through 1995. Recent financial upsets, however, have reduced immediate prospects to five percent, and declining.

Along with growth, Soeharto’s Indonesian government stood for an effective drive toward more equitable distribution of income. Since 1990, however, that success has tapered off, and it is further threatened by present economic turmoil. In recent years, furthermore, aid from advanced industrial economies has been accompanied by moral preachments. Indonesia has not tolerated them well.

When the Netherlands withheld financial aid over human rights questions in East Timor in 1992, President Soeharto withdrew Indonesia from the Dutch-chaired IGGI. A less concerted consortium of the World Bank replaced it. The military’s bloody mishandling of a demonstration in Dili led the American Congress to tie IMET to conditions of human rights. Later Indonesia effectively terminated the program. The USA, for several years since, has not had training contacts with promising young Indonesian military leaders — the very kind of professionals who could contend against human rights abuses by the armed forces.

Then last spring the U.S. Congress, in abundant righteousness, passed a resolution connecting critique of oppression in East Timor with the potential sale of F-16’s to Indonesia. Soeharto predictably declined the offer of purchase, and Indonesia bought Russian Sukhoi fighters instead. Thus a further cooperative link in the regional military operations is severed.

In this bilateral political void, over the summer, the major islands of Sumatra and Kalimantan burst into massive brush and forest fires whose smog blew west and north. Based on satellite imagery, estimates of affected areas are as high as two and a half million acres. President Soeharto apologized for exporting smoke to his Southeast Asian neighbors. That of course could not end the smoke, lessen the severity of the El Niño drought, or address systematic carelessness in massive clearing of plantations for palm oil. Now dry provinces everywhere sit in grey-blue haze awaiting overdue monsoons. The United States, like other nations, has tried to help. Indonesian newspapers showed front-page pictures of C-130’s dropping water bombs on brush fires in East Java. But crops, health, tourist income, and biodiversity all remain endangered until central policy and local practices change.

Even as the forests shot up in flames, the rupiah began to melt down. The Thai currency shocks of July continue to spread elsewhere in Asia, revealing financial flaws and unraveling confidence. By October 31st, monetary rout and investment flight had brought the value of the Indonesian stock market down by fully one-half in dollar terms.

Indonesia had by then accepted neighbors’ and international aid potentially reaching 40 billion dollars — the largest rescue since Mexico. An IMF team completed strenuous negotiations that involved Indonesian élites. Hard reckonings:

  • one of President Soeharto’s sons and his brother-in-law are to have their bank closed;
  • one of his cronies is to have exclusive licensing curtailed;
  • another son has to yield up presidency of the national car enterprise.

Many ambitious national projects are put on hold, while Indonesia returns to macro-economic discipline and attempts to correct micro-economic distortions.

Indonesian leadership is well aware that hunger (from failed grain and livestock harvests) and high prices (already felt regionally in several staples) can lead to a growing inflammation of the society. In the last year and a half there have been

– riots of labor in Tangerang;- riots of ethnic-religious complexion in Surabaya, Rengasdenklok, Situbondo, Tasikmalaya, and Ujung Pandang (Chinese Christians the chief sufferers);

– riots of intra-ethnic hatred on Kalimantan (Dyak vs. Madurese); and

– riots of overtly political character in Pekalongan, Banjarmasin, Jakarta and other places.

Indeed all of the riots may be called political, insofar as they arise from heightened expectations, relative deprivations, and long pent-up frustrations. In these conditions, and on its own terms, IMF aid to Indonesia is not a bailout of the undeserving. It works towards correction of distortions and an alleviation of social pain.

[Gazebo in Indonesia]How does it play, then, that the U.S. Congress goes home for its holidays while holding the IMF package hostage to American domestic politics on abortion? It looks bizarre and provincial.

It could get worse. We are still capable of shooting ourselves in both feet so that we can limp symmetrically. But it might be better to rebuild links with a major nation of 200 million people. The Senate in the Fall of 1996 and the House in the Spring of 1997 held hearings on policy towards Indonesia, signifying at last that Congress is laying the groundwork of information necessary to serious bilateral relations.

As Indonesian presidential elections near in March 1998 — and with them the critical designation of a vice-president – – the U.S. must regain the policy poise required to manage the relationship through five more Soeharto years. We should expect the issues to be as trying as with China in the last years of Deng Xiaoping’s power. We must give them the attention appropriate to a nation whose population equals that of Thailand, the Philippines, Vietnam, and Singapore combined (throw in Malaysia to top it). We know how to profit from Indonesia and how to lecture its leaders. More respect is in order for its depth of history and acuteness of problems.

America’s role is not to be the healer, far less the savior of Indonesia. We are not even its chief trading partner, investor or lender. But in reshaping our transpacific and global policies for the present age, the world’s greatest power should not appear to be a tower of ignorance. Congress, on its return, should act to restore the 3.5 billion dollar special emergency fund the administration seeks for IMF needs.

Indonesian smoke blows westward toward the Asian mainland, but the virus of financial infection travels everywhere. The IMF package may have some inoculative power. And a positive act by Congress toward Indonesia might clear the air to renew our bilateral relationship.

Brief Comment
on U.S.-Indonesian Affairs

by Amb. Ronald D. Palmer**

Theodore Friend’s moderate line (above) was initiated a few months ago by Ed Masters, President of the U.S.-Indonesia Society (e-mail <>) in, I believe, a letter to the International Herald Tribune published August 29, 1997. Friend’s article is nonetheless a sound approach to the question.

My own inclination, however, would be to expand on the Indonesia case as one among others where U.S. hubris or shortsightedness or even tunnel vision on human rights is causing us to concentrate on narrow policy objectives and to lose sight of our larger national foreign policy purposes. This loss of focus is reflected in the unthinking manner in which we use trade and other sanctions to seek to bring malefactors to their knees, metaphorically speaking.

“We are the United States,” some of us say, in line with such sanctions-driven policies.. “If you offend our sensitivities, we who are very pure, are so powerful that we can stamp our foot three times, take away your economic/military/foreign assistance toys and send you off to the corner to stand abashed until we deem you fit to rejoin the rest of the children in the game we run by the rules we set.”

“Soon,” some of us continue, “we will require White House reports on the persecution of Christians (you can’t trust those foreigner lovers in the State Department), and after that Congress will require semi-annual progress reports on the number of conversions and baptisms made by each U.S. diplomatic mission. Indeed, the concept of a ‘mission’ will take on sanctified and consecrated meaning.”

Published under the auspices of the Foreign Policy Research Institute, 1528 Walnut Street, Suite 610, Philadelphia, Pennsylvania 19102-3684, November 1997.

*Theodore Friend is a Senior Fellow at the Foreign Policy Research Institute and at this writing was just back from a three-week trip to Indonesia. His books include The Blue-Eyed Enemy: Japan Against the West in Java and Luzon, 1942-1945 (Princeton University Press, 1988).

[Ambassador Palmer] *** Ronald Palmer was U.S. ambassador to Togo 1976-1978, to Malaysia 1981-1983, and to Mauritius 1986-1989. During his 32-year career in the Foreign Service, he also held appointment as deputy assistant secretary of State, Bureau of Personnel. Amb. Palmer now serves as professor of international relations at The George Washington University.


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