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1 Introduction Notes 1 Introduction 1 . See also McIntyre and Ramage (2008). 2 . See, for example, Mietzner (2010). This, however, is a rather optimistic view of Indonesia’s democratization, which is in accordance with Diamond’s (2010) assessment of a decade of Indonesia’s democracy in a comparative perspective at global level. A less optimistic view, for example, argues that the democratic change in Indonesia has been superficial by which the oligarchic elites who controlled Suharto’s New Order have survived the 1998/99 regime change and continue to use the state for rent-seeking objectives (Robison and Hadiz, 2004; Boudreau, 2009). Others have identified several serious shortcomings embedded in Indonesia’s currently consolidated democracy. They include administrative ineffectiveness, rampant corruption, patronage, widespread money politics and the state’s failure to protect the rights of several minority groups, which has led scholars to label Indonesia’s democratic trajectory as a consolidated illiberal democracy (Hadiz, 2004), a consolidated patrimonial democracy (Webber, 2006), or simply a low-quality democracy (Klinken, 2009; Aspinall, 2013; Drakeley, 2014). For a comprehensive analysis of a decade of political reform in Indonesia, see Mietzner (2009a), Aspinall and Mietzner (2010) and Crouch (2010). 3 . See Booth (1999) and Cribb (1999). 4 . For a comprehensive review of key episodes of ethno-communal violence during Indonesia’s democratic transition, see Klinken (2007). 5 . According to a widely noted report by the Washington-based Centre for Global Development, a ‘struggling state like Indonesia, whose weakness has allowed terrorism, corruption, and civil conflict to take root in alarming ways’ has performed only slightly better than the comprehensively failed states of Afghanistan, Haiti or Somalia (CDG, 2004: 7). 6 . Suharto distinguished his regime from that of Sukarno as ‘New Order’. The social contract of the New Order was based on the principles of Pancasila (Five postulates), which consist of (1) Ketuhanan Yang Maha Esa (Belief in the one and only God), (2) Kemanusiaan Yang Adil dan Beradab (Just and civilized humanity), (3) Persatuan Indonesia (The unity of Indonesia), (4) Kerakyatan Yang Dipimpin oleh Hikmat Kebijaksanaan, dalam Permusyawaratan Perwakilan (Democracy guided by the inner wisdom in the unanimity arising out of deliberations amongst representatives) and (5) Keadilan Sosial bagi seluruh Rakyat Indonesia (Social justice for all the Indonesian people). Suharto came to power through a military coup against the threat of a communist take- over, as Indonesia was seen as the last bastion of the anti-communist front in Southeast Asia. Thus, against the Godless communists, belief in God was the first postulate of Pancasila. At the core of the new social contract is the belief that to work for social and economic justice is also to serve God; but to achieve social and economic justice, the country must achieve economic 183 184 Notes development, as the ideal or goal is not to suffer poverty together, but rather to share prosperity. This core principle provided the basis for Suharto’s growth and redistribution policies. 7 . As a part of International Monetary Fund’s (IMF) bailout requirements in the wake of the 1997–98 economic crisis, a law on competition policy was passed by the parliament in 1999 (Law no. 5) and the Indonesian competi- tion commission (Komisi Pengawas Persaingan Usaha/KPPU – Commission to Monitor Business Competition) was established through a presidential decree in the following year (Pangestu et al., 2002; Thee, 2002). Although there have been some reforms aimed at breaking the hold of the economy by a few connected families, their influence has not fully diminished. Nonetheless, the economy did recover from its worst decline, albeit slowly. Indonesia has managed to grow at an annual rate of around 5 per cent since 2003, but it is uneven across the regions and decent jobs growth in the formal sector remains a challenge, making it very difficult for poverty reduc- tion. This book, however, does not deal with the transition of the economic system directly. It seeks to relate social conflicts to democratic transition and decentralization – the transition to which is undisputable – and to the overall social economic progress. 8 . For example, Zakaria (2003) maintains that, given its income level, Indonesia in 1998 was not an ideal candidate for democracy. Instead, he says that the ideal contender is Indonesia’s neighbour, Malaysia, which has reached a per capita income of US$ 5,000, which is assumed to be the income threshold for democracy to be safe. 9 . This stability and peace, however, were achieved at the cost of approximately half a million people who were banished by the military in the name of purging the country of communists and their sympathizers (Cribb, 2001). 10 . More than one thousand people were killed in a two-day anti-Chinese riot in Jakarta only a week before President Suharto was removed from office. After that, armed separatist struggles in Aceh, Papua and East Timor intensified. Muslims and Christians killed each other in several hot-spots in the eastern part of the country. Even the much lower-profile routine-everyday violence increased markedly. See Tadjoeddin (2002a) and Varshney et al. (2008). 11 . See Bertrand (2004). 12 . See Huntington (1968), Snyder (2000) and Hegre et al. (2001). 13 . See Lipset (1959), Londregan and Poole (1996), Barro (1999), Przeworski et al. (2000), Papaioannou and Siourounis (2008a) and Acemoglu et al. (2009). 14 . See Collier and Rohner (2008) for theoretical and empirical findings on demo- cratic transition and violence in poor and lower-middle-income countries. 15 . See Tadjoeddin et al. (2001), Ross (2005), Tadjoeddin and Murshed (2007), Mancini (2008), Barron et al. (2009) and Murshed et al. (2009). 16 . See Collier and Hoeffler (1998, 2004) and Fearon and Laitin (2003) for the three most influential studies. 17 . See Tadjoeddin (2002a) and Varshney et al. (2008). 18 . Compared with secessionist and ethnic violence, terrorist violence came rather late. The October 2002 Bali bombing was the first and the deadliest terrorist incident in the country. The most commonly accepted definition of terrorism is focused on politically motivated violence directed against non- combatants (Burgoon, 2006). Notes 185 19 . For more discussion on this, see Horowitz (1985) and Varshney (2002). 20 . For example, three recent books on violent conflict at a country level on Indonesia (Bertrand, 2004; Sidel, 2006; Klinken, 2007) did not give attention to routine violence. 21 . However, they can also fall within the rational choice approach to conflict: that is, conflict is an optimal option for the conflicting parties, given the socio-economic circumstances at the time. Interestingly this relates to Marx’s famous quote: ‘The proletariat have nothing to lose but their chains. They have a world to win.’ 22 . See Murshed and Tadjoeddin (2009) for a review. 23 . See in particular Collier and Hoeffler (2002, 2004). 24 . See Sabine (1961). 25 . See footnote 1 on the ‘philosophical’, social, economic and political founda- tions of the New Order, embodied in the state principle of Pancasila. Sukarno also used Pancasila, but Suharto significantly redefined it with more emphasis on socio-economic development and shared prosperity, by linking them to religious duties. 26 . Suharto rose to power in the mode as, and roughly at the same time as, Zaire’s Mobutu (1965) and Chile’s Pinochet (1973). They were military generals, anti-communist and autocratically ruled their countries with strong support from the West. Since the collapse of communism in the late 1980s, these dictators were simply no longer needed. 27 . By providing legitimacy, development and diversification, reduced political risks. By contrast, Mobutu of Zaire did not opt for development and diversi- fication since he faced a high degree of societal opposition, which led him to believe that investments in infrastructure and other public goods would pose a threat to his grip on political power. 28 . See UNDP (2001). 29 . Pancasila is the Indonesian state philosophy that literally means ‘five postu- lates’; see endnote 1. 30 . This is in line with Ferguson’s (2006) hypothesis on the lethal coincidence of three forces (economic volatility, ethnic disintegration and end of empires) in explaining why twentieth-century wars were concentrated in east and central Europe. 31 . The term ‘aspirations to inequality’ was first introduced by Tadjoeddin et al. (2001) in the context of centre–regional conflict in Indonesia. 32 . The concept of horizontal inequality has its roots in Gurr’s concept of rela- tive deprivation (see Gurr (1970) and the discussion in the following sub- section). In the case of Indonesia, the sense of relative deprivation has not been the result of one group simply comparing its socio-economic position with another group; but it arose from a situation when one group compared itself with its past privileges. This has motivated it to try to regain political control when the situation permitted. This is different from relative depri- vation due to widening horizontal inequalities as argued by Stewart (2000), which is a genuine or pure grievance that can be more easily isolated from greed. 33 . See Mailath and Samuelson (2006) for a comprehensive treatment of repeated games. 34 . See also Chapter 3 on this. 186 Notes 35 . After exercising non-cooperative behaviour in the 1969 racial riots, Malaysia’s major ethnic groups (Malay, Chinese and Indian) came to an agreement in the form of the New Economic Policy. They cooperated to form a consen- sual political entity, the Barisan Nasional coalition, to execute the new social compact. It worked, demonstrating that everyone gained from such coopera- tion – but only after experiencing losses from their non-cooperative behav- iour in the riots. See Chowdhury and Islam (1996). 36 . For example, the Christians regained control in Maluku province and Poso district, and the Dayaks now enjoy political leadership in districts and prov- inces in Kalimantan.
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