Now, which are the missed opportuni

Now, which are the missed opportunities referred to in the title? Such counterfactual meditation is, of course, a hazardous exercise, but it may be able to throw light on the long-term lessons that can be drawn from the past two centuries. As Booth says, it is ‘useful to ask if a different type of colonialism could have produced better economic results’ (p. 329-330). First, one can think of the effects of the Cultivation System, which thwarted the development of market institutions in rural Java (p. 334), and on the whole was merely oriented towards remitting a large annual sum to the Dutch budget (p. 327). Secondly, the late colonial Dutch regime was busy ‘developing’ the colony in the material sense, but it largely ignored the need for higher education or developing a skilled Indonesian work force. The colonizers constructed a lot of infrastructure and social overhead capital. But the economic gains from these efforts were largely lost after independence, mainly because the educational system had failed to train a higher or middle class of officials who could take over the economy after independence. Booth even states that the ‘failure to accelerate access to education was probably the greatest of sins of omission of Dutch colonialism’ (p. 328). To perceive this as a missed chance for the Indonesian economy is feasible from the point of view of the Indonesian society itself, which was hindered by this imbalance. But it makes little sense when analyzing colonial policy: the Dutch simply did not plan to leave very soon, and therefore did not integrate the formation of an indigenous elite into their official policies. Of course, the colonizer can always be blamed for colonizing the country, but should it also be blamed for consistency within its own system? I think it is more important that there was a system of ethnic inequality or racial prejudice at the core of this Dutch colonial consistency. It is this legacy of colonial rule which certainly can be viewed as a “missed chance,” because it shows us, amongst others, the roots of the strong economic position of Chinese entrepreneurs, and the relatively weak indigenous entrepreneurial class. It also, in part, explains the discontinuity in economic development after independence. Booth draws attention to these matters and points at the crucial fact that the Indonesian nationalist leaders were essentially isolated from the economy or from specific economic ideas of how to rule the country: ‘the weakness of the indigenous business class in the late colonial era, together with the very small numbers of indigenous Indonesians in the upper echelons of the administrative service, or in the professions, meant that these groups had far less influence on the leaders of the independence struggle than in, for example, British India.’ (p. 330).
These reflections show that the historiography has progressed from making simple-minded or emotional accusations to the colonial regime, and now attempts to adopt a more objective perspective which allows for lessons to be drawn. There have been many crossroads at which another direction could have been taken, leading to different outcomes of economic development. Needless to say that there were also favourable effects of certain important events of Indonesia’s past. Do the parallels drawn between Suharto’s new order and the late colonial government policies also imply the suggestion that other roads could and should have been taken by post-independence governments, or in other words opportunities were missed? In Chapter 4, we find a positive evaluation of the progress made by the Suharto government during 1983-1990, making the non-oil sectors (agriculture, manufacturing, tourism) more internationally competitive and the economy less reliant on the exports of oil and gas (p. 199). At the same time, it is stressed that the role of the government in the economy was not in any way significantly reduced in the 1980s, and that very little attempt was made to privatise the state-owned enterprises, which had a very low rate of return. ‘Regulatory control over parts of the state-owned enterprise sector remains weak: the so-called “strategic enterprises,” controlled by the influential Minister of Research, Dr. Habibie, enjoy access to extra-budgetory sources of finance which are outside the control of the Ministry of Finance, or any other government regulatory agency …. This recurrence of the “Pertamina syndrome” indicates that the problem of controlling the state enterprise sector is far from resolved in New Order Indonesia’ (pp. 200-201). Recalling the airplane factory on the cover, probably Booth does view the Suharto/Habibie emphasis on prestigious, high-tech state enterprises such as an airplane industry as a missed chance. . .
As already mentioned, Booth is fairly positive about the investments of the government using the oil boom rents, at the same time warning that the economic reforms of the 1980s did not recreate the type of open trading regime that prevailed in the colonial economy from the 1870s to the early 1930s (p. 242). She also states that investment in education and human capital has, as it was in colonial times, in fact been neglected by the Indonesian government since 1950. In the last pages of Chapter 8, ‘Conclusions’, Booth describes the role and the shape of the type of “market capitalism” that is encountered in Indonesia (p. 334-336). Without referring to slogan type phrases such as ‘Asian values,’ she explains why free market capitalism is looked at with ambivalence in Indonesia. This deep ambivalence about liberal market capitalism persists in contemporary Indonesia at many different levels of society and this ambivalence has not exactly strengthened Indonesia’s economic performance. In part, the hesitation to accept free market capitalism is rooted in nationalist, anti-imperialist views of the pernicious colonial past. (This might have been different had the Dutch not been in Indonesia, but without the colonial state formation process there probably would not have been an Indonesian state as we know it today at all.) Senior policy-makers, including Suharto himself, saw free market capitalism as a good opportunity to favor their immediate families and close business associates. But more broadly, economic growth was viewed as necessary because the neighbouring countries around Indonesia realized rapid economic growth. Should Indonesia fall behind, then this would make it vulnerable to external threats and internal insurrections.
Recent events in the spring and summer of 1998, after this book had been published, confirm these suspicions. But Anne Booth goes one step further and compares the authoritarian growth-oriented state with other autoritarian developmental states such as Meiji Japan, Franco’s Spain, and South Korea under Park Chung Hee. The history of these three countries ‘would suggest that the forces of economic growth, once unleashed, will inevitably lead to demands for a stronger legal and constitutional framework which guarantees a broad range of civil liberties, including a stronger regime of property rights. In Indonesia, too, it is inevitable that economic growth will create such demands, which the political system will then have to accomodate.’ … How the government responds to these challenges will determine not just Indonesia’s economic future in the new millenium, but its very survival as a nation’ (p. 336). These ominous words aptly describe a process that has been underway, gaining speed after the KRISMON (monetary crisis in its Indonesian acronym) and Suharto’s stepping down, and which will draw the world’s attention to Indonesia for the next few years. It seems that a new ‘decolonization’ has just begun, and anyone who wants to put it in perspective is recommended to read this book.

Hasil (Bahasa Indonesia) 1:

Sekarang, yang disebut dalam judul kesempatan yang hilang? Meditasi seperti kontrafakta adalah, tentu saja, latihan yang berbahaya, tapi itu mungkin mampu melemparkan cahaya pada pelajaran jangka panjang yang dapat ditarik dari selama dua abad. Sebagai stan mengatakan, itu 'berguna untuk bertanya jika berbagai jenis kolonialisme dapat menghasilkan hasil yang lebih baik ekonomi' (p. 329-330). Pertama, orang dapat memikirkan efek dalam sistem budidaya tanaman, yang digagalkan pengembangan lembaga pasar di pedesaan Jawa (mukasurat 334), dan secara keseluruhan hanya berorientasi remitting tahunan jumlah besar untuk anggaran Belanda (mukasurat 327). Kedua, rezim kolonial Belanda terlambat sibuk 'berkembang' koloni dalam arti materiil, tapi itu sebagian besar diabaikan perlunya pendidikan tinggi atau mengembangkan tenaga kerja Indonesia yang terampil. Penjajah dibangun banyak infrastruktur dan modal sosial overhead. Tapi keuntungan ekonomi dari upaya ini terutama hilang setelah kemerdekaan, terutama karena sistem pendidikan telah gagal untuk kereta api kelas yang lebih tinggi atau menengah pejabat yang bisa mengambil alih ekonomi setelah kemerdekaan. Stan bahkan menyatakan bahwa 'kegagalan untuk mempercepat akses ke pendidikan adalah mungkin yang terbesar dari dosa-dosa dari kelalaian kolonialisme Belanda' (p. 328). Untuk menganggap ini sebagai kesempatan tidak terjawab bagi perekonomian Indonesia adalah layak dari sudut pandang masyarakat Indonesia sendiri, yang terhambat oleh ketidakseimbangan ini. Tapi itu tidak masuk akal ketika menganalisis kebijaksanaan kolonial: Belanda hanya tidak berencana untuk meninggalkan segera, dan karena itu tidak melakukan mengintegrasikan pembentukan elite pribumi ke kebijakan resmi mereka. Tentu saja, penjajah selalu harus disalahkan untuk mendiami negeri, tetapi harus itu juga harus disalahkan untuk konsistensi dalam sistem sendiri? Saya pikir lebih penting bahwa ada sistem ketidaksetaraan etnis atau prasangka rasial inti dari konsistensi kolonial Belanda ini. Hal ini ini warisan pemerintahan kolonial yang pasti dapat dilihat sebagai "kesempatan tidak terjawab," karena hal itu menunjukkan, antara lain, akar dari posisi ekonomi kuat para pengusaha Cina, dan kelas kewirausahaan adat relatif lemah. Selain itu, sebagian, menjelaskan diskontinuitas di ekonomi pembangunan setelah kemerdekaan. Booth menarik perhatian kepada hal ini dan poin pada fakta penting bahwa para pemimpin nasionalis Indonesia pada dasarnya terisolasi dari ekonomi atau dari ide-ide ekonomi yang spesifik tentang bagaimana memerintah negara: ' kelemahan kelas bisnis adat pada akhir zaman kolonial, bersama-sama dengan jumlah sangat kecil pribumi Indonesia di eselon atas pelayanan administrasi, atau di profesi, berarti bahwa kelompok-kelompok ini jauh lebih sedikit pengaruh pada para pemimpin perjuangan kemerdekaan daripada di, sebagai contoh, British India.' (p. 330).These reflections show that the historiography has progressed from making simple-minded or emotional accusations to the colonial regime, and now attempts to adopt a more objective perspective which allows for lessons to be drawn. There have been many crossroads at which another direction could have been taken, leading to different outcomes of economic development. Needless to say that there were also favourable effects of certain important events of Indonesia’s past. Do the parallels drawn between Suharto’s new order and the late colonial government policies also imply the suggestion that other roads could and should have been taken by post-independence governments, or in other words opportunities were missed? In Chapter 4, we find a positive evaluation of the progress made by the Suharto government during 1983-1990, making the non-oil sectors (agriculture, manufacturing, tourism) more internationally competitive and the economy less reliant on the exports of oil and gas (p. 199). At the same time, it is stressed that the role of the government in the economy was not in any way significantly reduced in the 1980s, and that very little attempt was made to privatise the state-owned enterprises, which had a very low rate of return. ‘Regulatory control over parts of the state-owned enterprise sector remains weak: the so-called “strategic enterprises,” controlled by the influential Minister of Research, Dr. Habibie, enjoy access to extra-budgetory sources of finance which are outside the control of the Ministry of Finance, or any other government regulatory agency …. This recurrence of the “Pertamina syndrome” indicates that the problem of controlling the state enterprise sector is far from resolved in New Order Indonesia’ (pp. 200-201). Recalling the airplane factory on the cover, probably Booth does view the Suharto/Habibie emphasis on prestigious, high-tech state enterprises such as an airplane industry as a missed chance. . .As already mentioned, Booth is fairly positive about the investments of the government using the oil boom rents, at the same time warning that the economic reforms of the 1980s did not recreate the type of open trading regime that prevailed in the colonial economy from the 1870s to the early 1930s (p. 242). She also states that investment in education and human capital has, as it was in colonial times, in fact been neglected by the Indonesian government since 1950. In the last pages of Chapter 8, ‘Conclusions’, Booth describes the role and the shape of the type of “market capitalism” that is encountered in Indonesia (p. 334-336). Without referring to slogan type phrases such as ‘Asian values,’ she explains why free market capitalism is looked at with ambivalence in Indonesia. This deep ambivalence about liberal market capitalism persists in contemporary Indonesia at many different levels of society and this ambivalence has not exactly strengthened Indonesia’s economic performance. In part, the hesitation to accept free market capitalism is rooted in nationalist, anti-imperialist views of the pernicious colonial past. (This might have been different had the Dutch not been in Indonesia, but without the colonial state formation process there probably would not have been an Indonesian state as we know it today at all.) Senior policy-makers, including Suharto himself, saw free market capitalism as a good opportunity to favor their immediate families and close business associates. But more broadly, economic growth was viewed as necessary because the neighbouring countries around Indonesia realized rapid economic growth. Should Indonesia fall behind, then this would make it vulnerable to external threats and internal insurrections.Recent events in the spring and summer of 1998, after this book had been published, confirm these suspicions. But Anne Booth goes one step further and compares the authoritarian growth-oriented state with other autoritarian developmental states such as Meiji Japan, Franco’s Spain, and South Korea under Park Chung Hee. The history of these three countries ‘would suggest that the forces of economic growth, once unleashed, will inevitably lead to demands for a stronger legal and constitutional framework which guarantees a broad range of civil liberties, including a stronger regime of property rights. In Indonesia, too, it is inevitable that economic growth will create such demands, which the political system will then have to accomodate.’ … How the government responds to these challenges will determine not just Indonesia’s economic future in the new millenium, but its very survival as a nation’ (p. 336). These ominous words aptly describe a process that has been underway, gaining speed after the KRISMON (monetary crisis in its Indonesian acronym) and Suharto’s stepping down, and which will draw the world’s attention to Indonesia for the next few years. It seems that a new ‘decolonization’ has just begun, and anyone who wants to put it in perspective is recommended to read this book.