During the period of New Order Indonesians have enjoyed unprecedented wealth, glory and recognition worldwide despite the unchallenged rule of Suharto who had brought about the prosperity to this country.
Since the day of suharto's impeachment, Indonesia and Indonesians have face some very serious problems like:

Food Shortage – Why?
Economic Imbalance – Why?
Racial disputes – Why?
Raging and uncontrollable Inflations – Why?
Rampant Corruptions almost every department – Why?
High Unemployment – Why?

All these above, are there any solution to it?

The answer is yes, but how and who will solve that problem.

Many of Indonesia asset have been taken by investors oversea.  Is that an investment or a mere corporate take over?  Could they have ended up like the case of Temasek's investments in the communications business.

Are there any sore eyes Indonesians political and business elite   
going to react once the business picks up?

The actions of these Indonesia's politicl and business elite are they
being rational or are they just luring these investors into Indonesia for a kill.

These are the problems that Indonesia is facing.

What must be done?

I will comment on these comments later in the evening since you said that you are in Singapore.

One thing first.  May I asked if the two of you were saying that there is an anti chinese bashing then are the two of you Chinese?  Because it plays an important part in personal views, nothing prejudicial.

<Take note that Indonesians rely on fuel subsidies massively for their daily life, especially through transportation. When oil prices hit triple digits in 2008 it became a huge burden for the Indonesian government to continue subsiding fuel at such low prices. >

It differs on how economic super structures are designed to undermine these problems.

In the US when it hit triple digits, it was immediately addressed and appropriate actions taken to apprehend the situation.  It was the speculation by OPEC members themselves who tried to undermine the US economy and thus affecting the world economic.

High fuel cost, low car sales.  The US government came up with a subsidy by taking all those oversize cars off the street with subsidy of up to 4,500 USD per car and on top of the car dealers even  further discounts to make car even cheaper.

Before a car cost approximately 25,000 USD but when they implement the scheme  the car cost around between 11,000 to 13,000 USD and yet it did not hurt the US economy infact it helps some of the car industries, why?

Why subsidies cost substantially to the Indonesian government and how come it had not to the US government?

<Similarly when food prices soared there was a need to reduce subsidies on such foodstuffs. So they lifted the subsidies and increased fuel and food prices.  This led to cost push inflation because of an increase in transportation costs and other costs of living, especially food.>

Agreed that the food cost after the lifiting of subsidies but not to that extent.  The government could make it mandatory for them to remain at certain of the price by offering incentives for businessmen to held the price low like tax cut, reduce import duties.  We are referring to basic essentials and that is an exception.

<In this aspect the administration then cannot be blamed for being unable to solve high inflation. They had no choice. Indonesia's economy wasn't that strong to begin with. So they had to rely on world prices>

The administration is to be blamed for such a high inflation rate causing so much  to the poor.  What is Bulog doing?  Sorry to say someone claimed Indonesia to be the world's 20 largest economy.

What was the import duty on the basic essentials?  Figure that out.  If the government had to forego the taxes then they have to do for the sake of the country.

There is also the anti hoarding law in indonesia enforced, how effective was that?

<Corruption (or broadly, KKN): This is already a practice fermented from the Suharto era.>

Suharto was helped by Liem Sioe Liong during his heydays of a Colonel and lets say he returned him the favor.  I am sure if you are Liem, what if there was a barter agreement between them?  Would you be doing that?  So that is KKN right!  For what cause?

<(think hildren fighting for monopolies to cars and toll roads and you give your business partner good monopoly deals) and this is a problem that could not be fixed within a decade (or two) after his downfall. >

I agreed that KKn has been going on and that was part of the deal.

For example if I want something to be developed, but the government has no money to do so, what must you do.  Open tender for BOT (Built Operate and Transfer) being the most logical sense.  There is no such things as monopoly because that was an agreement entered between a Indonesia's Department with either local or foreign.

So when you want infrastructure to be built by someone, say you, would you do it for free?  Whoever they are it doesn't matter because someone has to be there.  So is there something to complaint about or to cancel the agreement?

<You can't claim to solve KKN when you've got your minister of welfare not doing much to resolve mudflows.>

I absolutely agreed regarding the mudflow case because the f**k**g Japanese looking guy had washed his hands telling the country to pick up the tab and Abu Rizal Bakery is off the hook.  So is that a Chinese Problem or what?  Is this anti chinese bashing?  The president has every rights to exercise his executive order to dismiss what the vp had done.  Dragged that vp and ARB to the court room and make sure ARB pays for the losses and the sufferings of the people of Sidoardjo.

<Of course such behaviour is perhaps not that prevalent within the current Presidency, but all in all it takes time to develop good habits to destroy KKN completely…It probably won't be finished in this decade or the next though.>

Are you sure they are not that prevalent, ask  your economic Minister what she had done when she had that many customs officers replaced in the last revamp.  What about other department like justice, immigration, tax department etc.

<Suharto's economic policy of favouring Liem Sioe Liong only worsened matters because it deepened hate for the Chinese. But this policy favoured their Swiss bank accounts just fine. And it definitely suited Suharto. He had a scapegoat for the country's problems.

Did Sukarno cause that or Suharto?  Suharto had to used that as a ploy on the coup d'etat.  Now it is always that one sided view that others profess to cause the hatred.  Admit that or not it is your choice of believe.  Like I said there have been nothing to prove by anyone until this very day of the existence of his cash or hoardings in the Swiss Banks.  No one will stand up and admit that it is their own fault therefore this problems will continue to go on for whatever you want to take, decades century..whatever.  Therefore I had said this problem will not be resolve at all.  And it has nothing to do with anti chinese bashing.

<Just look at Tutut's Cinta Rupiah movement in 1997 and how she vilified Sofyan Wanandi for refusing to comply.>

When a person want to distract, there is always something to call for and tell me what was Tutut trying to do? Cheer the Indonesians? Or trying to whitewash what her family, brother and sisters did to Indonesia?

Let me just tell you this. BBD was almost taken by her when she approached the Bank asnd say she wanted to buy the bank using money loan from BBD.

Don't forget it was Suharto who required that ethnic Chinese carry "warga keturunan Cina" on their KTP.>

Yeah I know and it is he who wants all chinese to have their name Indonesiasikan a smart idea by his cabinet

<Correct me if I'm wrong, but this has disappeared since Reformasi, no?>

No it has not because the law had not change yet.

<And Confucianism is now an officially recognized religion, no?  And Chinese New Year can be celebrated in public no, now?>

The chinese were deprived of such priviledge, so returning them the priviledge is obviously the right thing to do.  And yet there are still people in Kalimantan being told to tone down their celebration.  Can't understand what that means when the Governor order the Chinese t have it low profile.

Post edited 11:29 pm – September 9, 2009 by Patung

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<As it is now, there is no solution for all the problems you mention. If we try to mend one problem, new ones pop up elsewhere. Our governing machine is just too big, slow, unintelligent, etc to keep up.>

Yes whenever a new leader takes up position he/she were given 5 years.  5 years is a short period for anyone to do anything for a country that vast.

Moreover what I know of is that the old cadres sitting in the old burnt seat is there readily to play new tricks to their new master.  Therefore when one problems is about to resolve a new one pops up and this is what exactly happened to Indonesia.

There were rampant corruptions in the custom and excise department.  But when this new guy took up position it was thought that he could do a better job.  But never to think that it was even worse.

There were those shipping company that paid taxes earlier for their goods at the container yard and everything went smoothly though there were corruptions.  But when this new guy took position.  His officers make demands and that for a certain container, with regardless what the content is, is to be taxed like 100 to 200 million rupiahs.  If they can't come up with that money the container is left to rot.  Followed by the fake subpoena for people who did not clear the container and then the sita process.

Just imagine, some of the container may have a worth or less than that, how could they be tax that heavily?  Where does the money goes to.  I have a friend who send home a video cam that he declared 500 USD and they were asking for 7 million for that.  He shook his head in disbelieve and forget that.  so where the view cam goes to?  we all can imagine.

These are those traitors of the country and bastards in the Indonesian society that crumpled and undermine the Indonesian economy.  That is why your economic minister took the step to give them a big slap in the face.  She even claimed to have seen envelopes in the drawers of custom officers.  They were being let off easily.  If there is any deterrence taken upon them.  Bring in new blood and try them out.  The outcome could be better.

Just try imagine how much a car cost in Indonesia?  For a country like Singapore it is alright because land were limited therefore exotic cars should be tax highest.  But Indonesia, mine,mine.

<Irrational investments, as you pointed out, are consequence of, but not really the root of our problem.>

Right, you have what they call the calculated risk in investments, whether you make or break.  They may not be the root to Indonesia's problem but they are the most sensitive in terms of economic cycle.  When One of the gear breaks the whole wheel just refused to move.

<Indonesia should be split in three or so separate new nations. This will force Jakarta to disband, and gives an opportunity to lay down a new, modern and efficient, governing infrastructure.>

Like, Tim Tim, Aceh, Maluku, Ambon, Irian perhaps?

No I think that is a more serious problems that happened in the eastern block. chechen, and all those broken up countries.

The look better in their environment but still lynching on others like Aceh for example.  They refuse to share the oil with Indonesia but needs DPR MPR to provide them with allocations.. How nice..

<This is the cost.  But the costs of authoritarianism are so much higher.  Singapore–where the dictators are rational, competent and not corruptible–is the exception.  So there you can make a good argument that giving up freedom and accountability can be justified.>

Cost of authoritarian country may be high because you need to pay people well to look after your people.  The penalty they face is also detrimental.

Singapore being a called a dictatorship country should have a new term to that.  Does the people there felt that they have been dictated?  If so by what?  Can I dictate you to do something, even though you are my employee?  The answer is no.  They are being dictated by a stern legal system, I agree.  LKY cannot dictate anyone.

Before I got my JD degree I always thought to have a different feeling towards LKY but my attitude change after that.  Because when you stand on top of a building and look downward what do you see.  A bunch of people running around.  What must you do to make sure these people are orderly.  So is that dictatorship?  The answer is no to me.  He had been in power for that long time because not he placed himself there, but the people feel that he should be there as no one was able to take his place, so was his successors, Goh Chok Tong, Lee Hsien Loong.  Can anyone pick someone in the region to make their equal.  I can seem to find one.  Mahatir may seemed to be one that is considered to be a smart guy in Malay politics.  But what had he done so far in terms of achievements and economic developments for Malaysia.  Why he went all the way out to get Anwar Ibrahim?  Because Anwar is smarter than him and had became a threat to his power.  until recently that he felt that he is old enough and unable to fight so he named a new successor.  Otherwise he would have died a bitter death in politic. 

<However, Suharto's greed, corruption and–as the krismon exposed–incompetence are the norm.  In such a situation, the "gains" are mostly hollow…hollowed out by the ruling clique.  Marcos, the military juntas in Thailand and Burma, Hun Sen, etc. all demonstrate this, in varying degrees.  >

I however cannot agree that there is such thig as Suharto's greed.  Nothing was proven.  No one convicted.  There were only allegations based on conjectures and nothing solid.  But if you were to say that his demise was caused largely by his kinfolks and children, I 100% agree.  That had been the pain in his arse for the last 20 years before his death because they were expanding at an alarming rate too significant to ignore by bothe people at home and overseas.

Belief you me, if you were to look more closely there isn't any Suharto's wealth lying around for anyone to find.

Let's hope that SBY does not have people around him to lynch on that.

Some corrections please.  100 to 100 should be 200 for the second one.  Thank you.

Well that is about the most logical foresight.