Retaliation and Reform

By widespread student rioting in the streets of Jakarta.

"Let the dust settle before the heads roll," counsels a Javanese proverb. For several days following the disastrous rioting in the streets of Jakarta that accompanied the visit of Japanese Premier Kakuei Tanaka (TIME, Jan. 28), the Indonesian government of General Suharto reacted hardly at all. Then, barely a week after the disturbances that had left eleven people dead, 807 automobiles gutted and 144 buildings damaged, the government retaliated. It shut down nine newspapers and arrested 775 persons, including 21 of Jakarta's most prominent intellectuals. The government's aim, declared one of the President's personal assistants, General Ali Murtopo--who had been accused of corruption and burned in effigy by students --must be to eliminate the country's "intolerable subversive elements."

Even as it moved against its noisiest critics, the Suharto government seemed to be admitting that many of the students' complaints had been valid. The Cabinet announced a new code of conduct aimed at reducing corruption. For example, officials will no longer be permitted to buy "personal" gifts for friends and business associates with government funds.

Appearing before the Indonesian Journalists' Association, General Suharto denied press reports linking his wife Ibu Tien (whom some foreign papers have unkindly dubbed "Ibu Ten Percent") to the ownership of four companies. One of those firms, the largest Toyota dealership in Jakarta, had been gutted by flames during the rioting.

Another complaint of the militant students was that Japanese businessmen were exploiting the country and working in league with Indonesia's Chinese community--to the detriment of the Indonesian masses. To meet that problem, the government decreed that in the future, any foreigner who wishes to do business in the country must go into partnership with a pribumi, an indigenous Indonesian--not a local Chinese. At least 51 % of the shares in the venture must be owned by an Indonesian.

Despite the recent wave of popular unrest, Indonesia is far better off than it was under dictatorial President Sukarno, whose government was overthrown eight years ago. Sukarno drove the country to the brink of bankruptcy; today it has a foreign exchange surplus of $500 million, an 8% growth rate and a 25% inflation rate (v. a crushing 635% in 1966). Jakarta's main thoroughfare, the Jalan M.H. Thamrin, is lined with modern hotels and high-rise office blocks.

Expelling Beggars. Nonetheless, the shack villages of the real Indonesia, where the majority of the country's 125 million people live, start only a few short blocks away. Roughly 35% of the country's work force of 39 million is unemployed, and every year the number increases by 1,400,000. In the capital, the government has invoked measures to deal with poverty. Four years ago officials declared that Jakarta was "a closed city to all future jobless settlers." Ever since, trainloads of beggars and unemployed city dwellers have been expelled and sent back to the provinces from which they came.

Indeed, overcrowding is a problem on the entire island of Java, where 60% of the nation's population lives (and where the density is 1,500 people per sq. mi.). Accordingly, the government is urging the Javanese to migrate to the less-populous outer islands. A highway is being built through the Sumatran jungle, for example, that will open up vast sections of the big island, which is 1 1/2 times the size of Japan.

Indonesia's strongest card is its rapidly developing petroleum industry. The oil crisis has enabled Suharto to boost the price of the daily output of 1.4 million bbl. from $4 to $10.80 per bbl. in the past year. The oilfields are owned by the state oil company, Pertamina, which estimates that it will have a daily output of 2 million bbl. by 1975. The problem is that the nation's new-found oil riches have contributed to the conspicuous consumption of the Indonesian rich (who make up only 3% of the population) but have hardly touched the lives of the peasant majority.

The recent rioting in Jakarta was not as serious as the student demonstrations earlier this year in Thailand and South Korea. But it showed that a student protest could explode within one hour into a riot of 100,000 people. That fact was not lost on Suharto's government. The army's own rebellion against Sukarno in 1965 was also preceded by widespread student rioting in the streets of Jakarta.

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