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Published online by Cambridge University Press: 07 May 2025
The examples above suggest governmental paralysis in the face of a pervasive corruption which impacts severely upon every important policy and institution in the republic. The President takes initiatives but hesitates fatally to follow through, and compromises his own reputation and effectiveness in the process. Most government ministries, for whom tactical funds and off-budget budgets are the stuff of life, do not even have a reform plan in front of them which would permit them to parlay their own essential income-boosting black funds (civil service pay being universally inadequate) against budgetary reform and a big boost to salaries.
[50] ‘Sharing Windfalls from the Sea’, Tempo, 12 December 2006.
In Tempo's words: ‘Non-budgetary funds [based partly on a 1 per cent “levy” on regular funding] from the Department of Maritime Affairs flowed [in 2002-4] to many names including ministers, political parties, and even presidential hopefuls.‘
[51] ‘The March from Banteng Square’, Tempo, 21-27 August 2007.
[52] This seems an appropriate place to lament the apparent failure of the jeering classes in Jakarta to complete Gus Dur's favourite reformasi joke about the Presidency:
The first president (Sukarno) was mad about women (gila wanita)
Suharto was mad about money (gila harta)
Habibie was plain mad (gila saja)
Gus Dur made everybody mad (membuat orang lain gila)
I propose (for discussion): Megawati was mad about generals (except Susilo)
Susilo is mad about generalities
[53] Tulus Wijanarko, et al, ‘Far reaching KPU Kickbacks’, Antara, No 37, V, 17 May 2005, in Asiaviews, 21 May 2005.
[54] ‘Budget Brokers Uncovered in Senayan’, Tempo, 20 September 2005.
[55] Imam Cahyono, ‘Does the PKS stand for justice and prosperity?', Jakarta Post, 16 November 2005; Santi W.E. Soekanto, ‘The Western media and Prosperous Justice Party', Jakarta Post, 24 June 2005.
[56] High-profile convicts in Cipinang gaol, Jakarta, include former chief of the state logistics agency (Bulog), Beddu Amang, former Minister of Trade and Industry, Rahardi Ramelan, business tycoon Probosutedjo (halfbrother of Suharto), and former Aceh governor Abdullah Puteh (for a kickback of several hundred thousand dollars in the purchase of a Russian helicopter for tsunami relief.) The President's Tim Task Tipikor had a target to resolve 16 graft cases at ministries and state-owned companies, but after a year the team only managed to resolve one. This involved haj funds and a mere Rp700 billion skimmed by officials at the Ministry of Religious Affairs. The AGO's 6000 prosecutors claimed to resolve 450 corruption cases in the first 10 months of 2006, with 15 suspended due to lack of evidence. But the cases, mostly in regional administration, were petty, apart from a bad loan case at the state-controlled Bank Mandiri, with state losses of a derisory Rp19 million. ‘Mixed results in government's anticorruption campaign’, Indonesia Corruption Watch, Berita, 6 June 2006.
[57] ‘Country Governance Assessment Report: Republic of Indonesia’, Asian Development Bank, Manila, 2004, p 66. The World Bank study, Combating Corruption in Indonesia, has a revealing section on careers for sale in the police, with the resulting market driven by the relative “wetness” of job openings. The Bank's poverty reduction experts suggest that, as with TNI, the official police budget covers only about 30 per cent of actual expenditure.(p 85) Unfortunately the Bank team decided to leave the military role in corruption for another day (p iv)—rather like doing Hamlet without the Prince.
[58] ‘Procurement bribery costs the country Rp36t yearly’, Jakarta Post, 13 November 2007.
[59] ‘Adnan Buyung Nasution: KPK Leader Election Backed by Corruptors’, Tempo, 7 December 2007
Antasari as Deputy Attorney General for General Crimes was notorious for prosecution failings in cases against Suharto pere and for involvement in the prison escape of Suharto fils, Tommy, when charged with a judge's murder. The Gadjah Mada University Anti-corruption Study Center lowered its flag to half mast on news of the appointment, while Denny Indrayana of GM said that the KPK under Antasari “will make the public hopeless”. Ridwan Max Sijabat, ‘Controversial prosecutor selected as KPK chief’, Jakarta Post, 6 December 2007.
[60] According to Tempo, Antasari as prosecutor also allegedly did deals in the Bank Indonesia Liquidity Assistance case and with teak thieves when posted in Sulawesi–and routinely bribed reporters. He was even suspected of bribing a PDI-P official to secure the anti-corruption commission (KPK) job. The candidacy of Amien Sunaryadi, vice chairman and commissioner of the KPK and civil society's unanimous choice for the chairmanship, was swamped by Golkar/PDI-P bloc voting in Commision III of the parliament. The heavy representation of former police and prosecutors in the new KPK was promptly deplored by Teten Masduki of Indonesian Corruption Watch. ‘Antasari Takes Center Stage’, Tempo, 11-17 December 2007. Tempo had already chosen Amien as Indonesia's “public figure of 2007”: ‘The Select Seven’, Tempo, 25-31 December 2007.
[61] ‘Will the Passionate Please Apply?‘, Tempo, 3-9 July 2007.
[62] Suara Pembaruan [Voice of Reform], 21 December 2006.
[63] For a case study of the standoff at the judicial commanding heights, see Simon Butt, ‘The Constitutional Court's Decision in the Dispute between the Supreme Court and the Judicial Commission: Banishing Judicial Accountability? ‘in Ross H. McLeod and Andrew J. MacIntyre, Indonesia: Democracy and the Promise of Good Governance, Institute of Southeast Asian Studies, Singapore, 2007.
[64] Bill Guerin, ‘Subsidy cut to fuel the fire in Indonesia’, Asia Times Online, 28 September 2005. See also ‘Indonesia's president summons Pertamina officials over fuel smuggling’, Agence France Press, 9 September 2005.
[65] Guerin, ibid; Shawn Donnan, ‘Indonesia gives oil price shock’, Financial Times, 3 October 2005
[66] A coalition of NGOs blew the whistle on KPU kickbacks just before the election of 2004. They have continued to criticise the KPK (Corruption Eradication Commission) for failing to charge all the KPU commissioners in the case. See chronology in ‘The Heat is On’, Tempo, 2 May 2005.
[67] For instance, the Malaysian Chinese plantation companies which orchestrate many of the perennial asphyxiating forest and peat fires associated with new palm oil development (and illegal logging) in Sumatra apparently enjoy complete legal impunity. See ‘Is Indonesia the third largest greenhouse gas polluter? Burning of peatlands fuels global warming’, mongabay.com, 3 November 2006.
[68] Ross H McLeod, ‘Soeharto's Indonesia: a Better Class of Corruption’, Agenda, Vol 7, No 2, 2000
[69] Ross H. McLeod, ‘Buying Support for Corruption with Inadequate Budgets and Low Salaries’, Paper presented in Panel 9: The State and Illegality in Indonesia, EUROSEAS Conference, Naples, 12-15 September 2007, p 1
[70] Ibid, p 24. Ross McLeod responds (email, 11 January 2008): Elsewhere I have referred to this episode [failure to repay conglomerate debt] as one of “grand larceny”:
‘Interestingly enough, if the government were to move much more aggressively to force the repayment of debts by the conglomerates, this would also help it to overcome resistance to the removal of subsidies. Much of this resistance is understandable, given the fact that members of the general public are well aware that they are having to bear a heavy financial burden as a result of failure of the banking system…and yet the biggest defaulters seem hardly to be suffering at all…[M]any…seem to have gotten away with grand larceny… Until now…no bank owner or manager has been punished for violating the regulations on excessive lending to affiliated companies, so there is little pressure to repay loans, even when the financial capacity to do so exists. ‘(Unpublished McLeod report, 2001).
[71] Ross H. McLeod, ‘Indonesia's New Deposit Guarantee Law’, Bulletin of Indonesian Economic Studies, Vol. 42, No. 1, 2006. p 67.
[72] ‘BI Deputy Governor Questioned by KPK’, Tempo, 29 October, 2007.
[73] See Mushtaq H Khan and Jomo Kwame Sundaram (eds), Rents, Rent-Seeking and Economic Development: Theory and Evidence in Asia, Cambridge University Press, Cambridge, 2000. The Indonesia chapter by Andrew McIntyre discusses off-budget behaviour under Suharto.
[74] Richard Robison and Vedi Hadiz, Reorganising Power in Indonesia: The Politics of Oligarchy in an Age of Markets, Routledge Curzon, New York, 2004, p 31
[75] ‘Too High a Price: The Human Rights Cost of the Indonesian Military's Economic Activities’, Human Rights Watch, Vol 18, No 5(C), June 2006.
[76] ‘Protest and Punishment: Political Prisoners in Papua’, Human Rights Watch, Vol 19, No 4 (C), February 2007.
[77] An outstanding short survey of contemporary KKN which brings out this point is Gary Goodpaster, ‘Reflections on Corruption in Indonesia’ in Tim Lindsey and Howard Dick (eds), Corruption in Asia: Rethinking the Governance Paradigm, Federation Press, Sydney, nd [2001?].
[78] Ross H. McLeod, ‘Indonesia's vulnerability to a new balance of payments and banking crisis’, paper presented in Panel 16: Ten Years after the Pacific Asia Crisis, EUROSEAS Conference, Naples, 12-15 September 2007.
[79] Jim Elmslie with Peter King and Jake Lynch, Blundering In? The Australia-Indonesia security treaty and the humanitarian crisis in West Papua, Centre for Peace and Conflict Studies, University of Sydney, March 2007.
[80] ‘Poverty in Indonesia: Always with them’, The Economist, 14 September 2006. According to this article, ‘the government's definition of poverty—less money than is needed to afford a diet of 2,100 calories a day—is 152,847 rupiah ($16.80) a month'—that is, about 50 cents a day. For a reading of the impact of fuel and other fluctuating prices on the actual poor of real Jakarta streets–including the brain development (not to mention the education) of children, see Allan Nairn, ‘Economic Indicator', blogspot, 14 January 2008. Allan points out that a poor family can be quickly ruined financially when a son's jail sentence triggers peremptory demands for bribes to ensure survival rations and shelter for him. ‘Duduk - Duduk, Ngobrol - Ngobrol. Sitting Around Talking, in Indonesia’, blogspot, 8 November 2007.
[81] Jim Schiller, ‘Un-natural disaster’, Inside Indonesia, 91, January-March 2008
[82] Ben Sandilands, ‘The Yogyakarta crash: Garuda, not the pilots, are to blame’, Crikey.com, 23 October 2007.
[83] Agus A Alua, ‘Implementation of the Special Autonomy Law in West Papua, Indonesia’, Paper presented at the Indonesia Solidarity/ West Papua Project Conference at Sydney University, 9-10 August 2007 [available online]
Agus is chairman of Papua's new (and unique in Indonesia) “upper house”, the all-Papuan MRP (Majelis Rakyat Papua) and general secretary (still) of the non-violent independence movement's PDP (Presidium Dewan Papua—Papua Council Presidium).
[84] ‘A Comedy of Unforced Errors’, Tempo, November 26-December 3, 2007; ‘The Timber King Escapes—Again’, Tempo, 20-26 November 2007; ‘Verdict Loopholes’, Tempo, 13-19 November 2007. Adelin was accused of causing Rp32 trillion in state losses.
[85] Stephen Fitzpatrick, ‘Smoke shrouds green scheme’ and ‘The biofuel that spells annihilation for Indonesia's wilderness’, The Australian, 24 November, 2007.
[86] ‘Indonesia Refuses To Have Timika and East Timor Cases as a Condition of Resuming Indonesia-US Military Cooperation’, Tempo, 23 November 2004. Sudarsono's non-ministerial attitude to TNI can be gleaned from'Things will not improve unless we have a strong leadership', Address to the Indonesian Business Forum of Shanghai, 19 November 2002
[87] ‘Too High a Price: The Human Rights Cost of the Indonesian Military's Economic Activities’, Part III
[88] The disintegrative tendencies unhappily apparent in East Timor since 1999 can be attributed not only to inexperienced leadership and its Indonesian legacy but to Australia's deplorable post-liberation role as resource thief and impatient, self-centered peace-keeper: in short, regional Big Brother. See Paul Cleary, Shakedown: Australia's Grab For Timor Oil, Allen & Unwin, Sydney, 2007
[89] Mark Forbes, ‘Suharto casts shadow over graft meeting’, Sydney Morning Herald, 2 February 2008
[90] Peter King, West Papua and Indonesia in the 21st Century: Resilient Minnow? Implacable Minotaur?' Paper presented to Panel 34, Enduring Conflicts and Ethnic Resilience, EUROSEAS Conference, Naples, 12-14 September 2007.
[91] In the context of generational change it is perhaps a small consolation that the US$1.4 billion civil case for misuse of funds in Suharto's Supersemar “charitable” foundation, supposedly devoted to education programs but freely available to family and cronies, will now target the six Suharto children. See Stephen Fitzpatrick, ‘Suharto children's assets facing freeze’, The Australian, 2 February 2008.
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