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Bulletin of Indonesian Economic Studies

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To cite this article: (2007) BOOK REVIEWS, Bulletin of Indonesian Economic Studies, 43:3, 409-424, DOI: 10.1080/00074910701727647

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ISSN 0007-4918 print/ISSN 1472-7234 online/07/030409-16 DOI: 10.1080/00074910701727647

BOOK REVIEWS

Moh. Arsjad Anwar, Aris Ananta and Ari Kuncoro (eds) (2007)

Kesan Para Sahabat tentang Widjojo Nitisastro

[Friends’ Impressions of Widjojo Nitisastro] and

Tributes for Widjojo Nitisastro by Friends from 27 Foreign Countries, pp. 528 and 382, Kompas Publishers, Jakarta.

An Indonesian perspective

Those who are fond of words may be disappointed by Widjojo Nitisastro. Often identiﬁ_{ed as the architect of Indonesia’s New Order economy, he does not seek the} limelight, but works behind the scenes. He is rather like a Swiss watch: meticu-lous, precise and of high reputation. Widjojo obtained his PhD in economics from the University of California at Berkeley in 1961, and was regularly on the policy stage in the past, but disliked bright lights and applause. Perhaps for this reason people are curious about the man, his experiences and his thinking.

These two collections of writings may go some way toward satisfying that curi-osity. The ﬁ_{rst contains impressions by 55 friends including Ali Wardhana, Emil} Salim, Mohammad Sadli, Jacob Oetama, Tauﬁ_{k Abdullah, Boediono and Fuad} Hassan. The second offers tributes in English by 71 friends from 27 countries— from Indian prime minister Manmohan Singh, former Tanzanian president Julius Nyerere and the IMF’s Stanley Fischer to academic names such as former Harvard University president Lawrence Summers. Even this brief list says much about Widjojo’s reputation.

These books show mid-1960s Indonesia as a country in disarray and despair. Almost 80% of the population was acutely poor. Foreign exchange was used only to import food and capital goods. International conﬁ_{dence was so low that} Indonesia had trouble obtaining overseas loans. Rice could scarcely be traded between one province and another, and any rice that was traded had to pass through multiple check-points. Food security dominated discussion in govern-ment and throughout the country. The economic policy prescriptions that Wid-jojo and his colleagues used to tackle this issue were both praised and criticised for decades. Opponents labelled the group the ’Dons of the Berkeley Maﬁ_{a’. Yet} countless articles, theses and dissertations have been written analysing their eco-nomic policies.

This book may frustrate those seeking a close link between the thinking of Widjojo and the Chicago School—the ’vanguard’ of liberal economics. The tech-nocrats, including Widjojo, are more accurately classed as Keynesian. Although believing in the market, they saw the role of government as very important. The technocrats were not neo-classical economists of the Milton Friedman school, who

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favour minimal government intervention. Harvard professor Henry Rosovsky quotes Widjojo thus: Indonesia succeeded in sharply reducing poverty through three combinations of policies: ﬁ_{rst, encouraging growth in labour-intensive} agriculture, and later in labour-intensive export-oriented manufacturing; sec-ond, involving the poor in development through improvements in education and health, and through increased investment in infrastructure; and third, controlling population growth. This recipe, a pragmatic mix of market approaches and gov-ernment intervention, is still supported by many economists, whether they agree with Widjojo’s views or not.

Widjojo’s interest in agriculture and welfare is clear from the contributions by Ali Wardhana, David Cole, Saleh Aﬁ_{ff and Walter Falcon. Retired Stanford} pro-fessor Falcon notes his intense discussions with Widjojo and Saleh Aﬁ_{ff at the} beginning of the New Order, about their anxiety over rainfall, about rice transport vessels in transit, and about every grain of rice available now and several months hence. Widjojo was especially concerned about the need to increase the use of nitrogen fertiliser, and about fertiliser types, response ratios, interactions between fertiliser and water and other inputs, and mechanisms for making fertiliser avail-able to poor farmers. He had a deep interest in positive rice price policies and in how to allocate resources to stabilise the rice price and encourage investment in agriculture.

Human resource development in rural areas was another primary issue in his thinking. Education for village children, health services for village communities, and family planning programs are part of what Falcon calls the ’Widjojo lexicon’ (‘kamus Widjojo’). We see this in various Inpres (Presidential Instruction) pro-grams in education and health announced by the government.

These contributions are signiﬁ_{cant because of the recent impression that} agri-culture and welfare have been neglected in Indonesian economic development. Several contributors see the main reason for rural economic growth and poverty reduction as being Widjojo’s interest in the fate of farmers, in intensive technology for agriculture, in improving infrastructure and in efforts to safeguard macro-economic stability.

The debates on economic policy in Indonesia were not based on strong ideo-logical foundations. What happened was merely a process of rational decision making about the economic policy choices most benefi_{cial to development, with} ’benefi_{cial’ here translated as ’having the lowest economic and political costs’. In} the 1970s when oil funds were available and the nationalists held sway, non-mar-ket and protectionist policy choices—socialist command economy style—were relatively ’cheap’ compared with market policies. The government used pro-ceeds from the oil bonanza to fund programs for the poor in education, health and public housing, as H.A.R. Tilaar writes. But in the mid-1980s when the oil price fell below $10 a barrel, government revenues were limited, and non-market policy choices became more ’expensive’ than liberal pro-market and economic deregulation policies, as Arifi_{n Siregar says. In other words, ideologies such as} liberalism were a ’result’, not a ’cause’.

Widjojo was not a dogmatic person, believing that reality often provides the answer; for example, he at ﬁ_{rst supported pesticide subsidies but later realised} that they had a negative effect on farms, and supported their withdrawal by Sumarlin and Saleh Aﬁ_ff.

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Gustav Papanek of Harvard and Boston universities told me how Widjojo always sought fi_{rst-hand information from the}fi_{eld. It was this that distinguished} him from ‘behind-the-desk’ policy makers. Permadi, former director of Bank Rak-yat Indonesia (the People’s Bank of Indonesia), writes that Widjojo conducted direct cross-checks with farmers receiving credit, fertilisers and pesticides along the Jalur Pantura (the north coast highway from Jakarta to Surabaya) under the Bimas rice intensifi_{cation program. Former agriculture minister Wardojo recounts} how Widjojo would invite him on drives to fertiliser- and pesticide-poor regions, quizzing him about agriculture and rural life.

These two collections were begun for Professor Widjojo Nitisastro’s 70th birth-day 10 years ago, but were only published this year. They do not cover his entire body of thought. Rather, as their titles suggest, they are fragmentary impressions and recollections. Those who hope for a systematic explanation of the policies of Widjojo and the technocrats will not ﬁ_{nd it in these books. This is precisely} what makes them interesting: they do not try to explain the theory behind policy changes, but simply recount experiences that enrich our understanding of this economist born in Malang, East Java, on 23 September 1927.

M. Chatib Basri

The above is a translated and edited version of a review entitled ‘Arloji Swiss bernama Widjojo Nitisastro [A Swiss watch named Widjojo Nitisastro]’, Kompas, 26 February 2007.

An Australian perspective

Professor Widjojo’s central role as the chief architect of Indonesian economic pol-icy under President Soeharto, and of the country’s historic transformation from a ‘basket case’ in 1965–66 to a dynamic industrialising economy within the next three decades, is well known. Much less is known about the man himself, for he has always maintained a high degree of privacy and, above all, complete discre-tion about his reladiscre-tions with his former boss, ex-president Soeharto. The two books under review tell us more about his life, his personality and his modus operandi

than anything I have seen previously. I found the Indonesian-language version much more informative—and generally likeable—than the tributesby foreigners, simply because the friends who have known him longest have far more interest-ing stories to tell than any of the 69 international ﬁ_{gures whose universal praise} for him, well deserved though it is, tends to be repetitive and superﬁ_cial—with a few exceptions that are useful for the details they add. Those by the three Aus-tralians, Heinz Arndt (a bit too self-referential for my taste), Peter McCawley and Nick Hope, have some interesting things to say, as do David Cole, Bill Hollinger, Walter Falcon and Gerardo Sicat, who were close to the action with Widjojo at important times.

Of the foreign contributions, I thought the best were by Gamani Corea, UNCTAD Secretary General 1974–78, and Jack Bresnan, whose role in persuad-ing the Ford Foundation to make crucial contributions to upgradpersuad-ing Indonesian economic (and other) faculties from the 1950s was invaluable. Both got to know Widjojo well, and the context of politico-administrative problems that he and they had to untangle. Both those pieces need to be read in full, but two quotations may sufﬁ_{ce here to draw the reader further into them. Corea writes that Widjojo’s}

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work, international as well as national, was outstanding by any reckoning; but it was his personal qualities that stood out. ‘He was practical in approach and not a prisoner of intellectual dogmas and ideological postures. He was sensitive to the wider processes at work in the society … [and] at the same time a man of action. He was indefatigable and persevering in his effort to get things done … But there was also the warmth of his personality that specially endeared him to those who came to be acquainted with him.’ (I can myself testify to all that, having worked alongside him in 1956–57 in the state planning bureau before he went to Berke-ley. Fifty years later, I ﬁ_{nd him still essentially the same person he was then, as} several of his Indonesian friends from the early days have also remarked.) Jack Bresnan found him ‘as full of youthful enthusiasm as ever’ on matters of policy even as late as 1983, and ‘as modest as ever’ in sharing the responsibility for suc-cess with others. Intriguingly, Bresnan quotes an Indonesian poet, unnamed, who remarked that what made Widjojo so inﬂ_{uential was ‘the purity of his language’.} He writes with great clarity and simplicity, both in Indonesian (no small feat, on some matters) and in English. His great ability as a public speaker, not usually mentioned among his notable strengths, was displayed during the 1982 general election campaign, I recall, when he bolstered the efforts of Golkar (the then gov-ernment party) across Java with superbly persuasive speeches expounding to ordinary people the workings of the development process that was only just start-ing to yield tangible results for many of them. That was somethstart-ing Widjojo cared about intensely. From his earliest research work at the University of Indonesia (UI) in the 1950s to his experiences in UNCTAD and the North–South dialogue in the 1970s and 1980s, his concern to reduce the poverty of the masses in Indonesia and far beyond was a constant in this thinking.

The contributions by Indonesians, nearly all much longer and in many cases extremely valuable raw material for any future biography (not least because they reveal also the very diverse—and admirable—personalities of the other tech-nocrats, from Sadli, Emil Salim, Suhadi and Ali Wardhana to Subroto, Sumar-lin, Saleh Afi_{ff and Mar’ie Muhammad), testify to his perfectionism, attention} to detail, hard work and personal friendliness. Two pieces are especially worth reading. One is by Mustapadidjaja on the courageous part Widjojo played in the January 1966 ‘Tracee Baru’ seminar at UI, which spurred the student upheaval that fi_{nally overthrew President Soekarno. The other is by Boediono, who could} be called a second-generation technocrat, entering the circle only when he came to the national planning agency in the 1990s, later to become state planning minister in 1998–99, fi_{nance minister in 2001–04 and coordinating minister for economic} affairs under Susilo Bambang Yudhoyono. Boediono has a nice story about being sent by Widjojo a photocopied extract from the Yes, Prime Minister television series, which left him puzzling about which (if any) of several possible messages his boss may have intended to convey.

Emil Salim gives a crisp account of the way the technocrats came together under the leadership of Widjojo as the ‘lurah’ [village head] who led through musya warah

and gotong royong [consultation and cooperation] in the early years after 1966, when they confronted together the massive task of bringing runaway inﬂ_{ation under} con-trol and restoring Indonesia’s economy to health. Ariﬁ_{n Siregar, former Bank} Indo-nesia governor and trade minister, not initially regarded as one of the technocrats although very similar in outlook, provides a useful account of Widjojo’s part in

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handling the 1974–75 debt crisis of the state oil company, Pertamina, and in formu-lating the ﬁ_rstﬁ_{nancial deregulation package in 1983. He writes: ‘as well as being} a very friendly person and prepared to listen with full attention to the analyses of his colleagues, he also possessed wisdom, breadth of knowledge and a sharp ana-lytical ability …. Through his simplicity and sense of humour he made the people he was talking to feel calm and at ease.’ But I think Sadli put it best. ‘What were his strengths? I will only mention some. His thinking was very sharp. His sense of detail and perfectionism were very great … But in his [public?] communication he was not so easy-going, relaxed and straightforward. He was more circumspect, dip-lomatic, always watching his words. His commitment to any objective he consid-ered highly important (such as managing the national economy) was always very strong. In this respect he had the character of a “bulldog” or “terrier” that would never let go. But it was a bulldog that could be diplomatic.’

Jamie Mackie

John Bresnan (2006) At Home Abroad: A Memoir of the Ford Foundation in Indonesia 1953–1973, Equinox Publishing, Jakarta, pp. xi + 213. US$16.95.

When John (Jack) Bresnan died aged 79 on 24 May 2006 he left a substantial legacy of scholarship and development assistance related to Southeast Asia, and Indo-nesia in particular. At Home Abroad links these two interests, being at once an insider’s reﬂ_{ections on the purpose and impact of international philanthropy and} a source of historical insight into the lives of key actors in the story of the ﬁ_rst half-century of Indonesian independence.

Bresnan sets out in his introduction (p. 2) the questions he wants to answer: ’Why has the Ford Foundation invested in Indonesia over so many years? Why has it maintained a resident staff there? . . . Was it worth doing? Would I do it again?’ In the following 200 pages he tells the stories and introduces the people that provide evidence for his forceful answers to these questions.

For Indonesianists all the 30 short chapters are gems to be appreciated. There is a useful index, but no glossary to help with the acronyms. Anecdotes and quotes from the Ford Foundation archives form a compatible mix to drive home some of Bresnan’s long-held concerns about the Indonesian–American relationship. The famous 18-month hiatus after the Ford Jakarta offi_{ce was closed in March} 1965 was long attributed to attacks against Ford-funded teachers at the Malang technical college. Bresnan combed the archives, and delights in revealing that the timing of the various memos between the State Department and the Ford New York offi_{ce does not support that explanation. Instead he looks to the attitudes} held by senior Ford offi_{cials and their wives. The particular incident that typi}fi_es these occurred in 1964 when, after being the subject of Sukarno’s womanising at a palace function, a Ford offi_{cial’s wife declared, ‘this country is in the hands of} a seventeen year old boy’ (Bresnan quoting the offi_{cial’s memoirs on p. 56).} Simi-larly, Rockefeller Foundation offi_{cers refused to support agricultural research in ’a} country that had Sukarno as its leader’. Bresnan implies that lechery rather than ideology was a key factor in shaping such attitudes (p. 132).

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Bresnan’s own attitudes about Indonesia were set by other Indonesians who always displayed impeccable grace, goodwill and humour, including Widjojo Nitisastro, Ali Wardhana, Selo Soemardjan and Soedjatmoko. These are the people he remembers with warmth and about whom he writes with the greatest respect. By contrast, some of the patricians of New York earn his gentle rebuke for confus-ing a country with its leader.

For readers of BIES, his assessment of the contributions Ford made to training the ’Berkeley Mafi_{a‘ is instructive, and is set out in several chapters. Looking at} the whole experience, he says, ’the irony of the University of Indonesia econom-ics project was that it failed to create a strong academic institution, but succeeded in creating a group of economic policy makers who for a quarter-century were to have a powerful impact on the entire population of the country‘ (p. 111). This sounds surprising given the very high reputation that the University of Indonesia, Gadjah Mada University and other large government-supported universities have in Indonesia. What it refl_{ects is Bresnan’s clear-eyed perception that inadequate} staff salaries and a lack of incentives to devote suffi_{cient time to teaching still hold} back the Indonesian higher education system even in the famous faculties.

So was the Ford program in Indonesia worth it? Yes, he declares, the Founda-tion can be very proud of the impact its half-century of investments has had on the promotion of economic development, rice production, social science research and family planning. But would he do it again if he had known about all the disruption he would deal with during the turbulent 1960s and 1970s? ’In a New York minute‘ is his reply. Despite the difﬁ_{culties faced by his family when his older children had} to return to the US for schooling, leaving only the youngest daughter to accompany the parents to Jakarta, he and the family would certainly do it all again.

The Bresnans loved Indonesia and, in the quarter of a century following his departure as Ford Representative, Jack maintained his links to the country through his work as the head of Ford’s Ofﬁ_{ce of Asian Affairs, and later at} Colum-bia University where he was a Senior Researcher from 1982 until 2005. This book represents an important chronicle of the New Order period, and particularly the crucial formative years, when the Ford Foundation played a decisive role. It is not a sourcebook for economics or politics, but it is the sort of book every Indonesian-ist should have who wants to gain some insights into the context of Indonesian development, and a privileged look at Indonesian leaders.

Terence H. Hull

William Easterly (2006) The White Man’s Burden:

Why the West’s Efforts to Aid the Rest Have Done So Much Ill and So Little Good, Penguin Press, New York, pp. 417. US$27.95.

Lack of inexpensive medical remedies and ineffective foreign aid are two tragedies of the world’s poor. The theme of The White Man’s Burden (WMB) encapsulates these tragedies, including the inability of aid programs to get 12-cent medicines to children, $4 bed nets to poor families to prevent half of all malaria deaths, and $3 to each new mother to prevent ﬁ_{ve million child deaths annually.}

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Bill Easterly is a prominent academic critic of aid. His earlier book, The Elusive Quest for Growth, followed by his dismissal from his then employer, the World Bank, led me to predict that a sequel was in order. WMB is a counter-punch! It asks the right question, and the message is clear: the ‘Planner’ approach used by most agencies, presumably including the World Bank, fails because ‘Plan-ners’ think they already know the answers, and their programs raise expectations without taking responsibility for meeting them. Their approach is to determine what to supply to the poor rather than what is in demand. Easterly contrasts this with the approach of the ‘Searchers’, who admit they do not know the answers in advance, and believe that poverty is a complicated tangle of political, social, historical, institutional and technological factors. ‘Searchers’ ﬁ_{nd things that work} and generate some rewards, and they accept responsibility for their actions. Using this contrast, it is not difﬁ_{cult to understand why ‘Planners’ like to make changes} with big push programs, whereas ‘Searchers’ prefer piecemeal and experimen-tal ways to move towards prosperity. Like the colonialists of old, ‘Planners’ are not held accountable for failures, and nor do they seek feedback from the poor, because the poor have little power to hold aid agencies accountable. Many for-eign aid programs from the West fail because they use the ‘Planner’ approach. In essence, this is the answer to the question raised in the sub-title ‘Why the West’s efforts to aid the rest have done so much ill and so little good’.

Another problem with aid programs is that often they must go through gov-ernment and the bureaucracy, yet in many poor countries govgov-ernment can be the source of the problem. But Easterly argues that neither getting tough with governments to force changes nor allowing governments to determine their own strategies will work to the beneﬁ_{t of the poor. He maintains that today’s system of} foreign aid coddles bad governments and does not help the very poor with their most desperate needs. He suggests letting ‘social and economic interactions con-tinue between private citizens of all lands’. He also advises that ‘when working with government doesn’t get results for the poor, aid agencies should try some-thing else’ (p. 138).

Easterly combines compassion with clear-eyed empiricism. He believes the future of foreign aid lies in greater voting power for the poor (p. 181), and that the dynamism of the poor will bring better results than a plan imposed from the top (p. 94). Opportunities provided by the free market depend on ‘bottom-up’ social choices. There is actually nothing ground-breaking about his message: isn’t it widely known that aid programs reach their targets better if designed and implemented by people whose thinking is contextual and focused on the indi-vidual case (Socratic lean), rather than by passive absorbers of intact knowledge and information (Platonic slant)? The experience with aid in post-tsunami Aceh provides plenty of examples of foreign NGOs creating problems rather than real solutions in an effort to appear compassionate, or simply pocketing aid money; the damage caused by their presence is enormous: intrusion into local tradition and culture, exorbitant prices and so on.

The idea that greater participation of disenfranchised groups would improve the outcomes of aid programs is also not new. The problem is that poverty itself determines the extent of participation: a higher proportion of poor people implies a smaller proportion of informed voters, hence lower political participation. This will constrain the ‘check-and-balance’ process, and cause pro-poor aid programs to

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fail. But poor countries are not doomed, because participation can be initiated pur-posefully through commitment, using price, for example. Easterly cites a program where mothers sell insecticide-treated bed nets for 50 cents each in rural Malawi; this has increased ‘the nationwide average of children under 5 sleeping under nets from 8 percent in 2000 to 55 percent in 2004’. In contrast, when the nets were handed out free as in Zambia, ‘70 percent of the recipients didn’t use [them]’.

Easterly criticises international agencies such as the IMF for their lack of accountability to the intended poor beneﬁ_{ciaries of their stabilisation program,} and for their intrusive conditionality. The bad record of the Fund’s programs in poor countries leads him to suggest that the IMF should exit entirely from these countries and allow traditional aid agencies to operate. Indeed, the broader argu-ment of WMB is that any program imposed from outside will not work. Easterly uses the example of East Asia’s economic success stories, Japan, China, Taiwan, South Korea and Thailand. These countries were never successfully colonised by the West, and they built a foundation for rapid economic growth through their own evolving cultures, rules and disciplines. Indonesians, under post-1997 crisis policy imposed by the international organisations, had the slowest recovery of all ‘crisis countries’. Could it be that occupation over three centuries by the West has anything to do with Indonesians’ lack of conﬁ_{dence and unwillingness to argue} with the international agencies?

WMB gives numerous practical reasons why most aid programs fail, but it does not deal with the concept of altruism, the motivation for giving aid. The interac-tion between the intrinsic and extrinsic motivainterac-tion of donors always inﬂ_uences the act of aid-giving. Aid providers can be altruistic when their utility comes from the act of giving and from their concern for the well-being of others, but they can have heterogeneous preferences and characteristics. It would have been use-ful if WMB had tried to show whether aid programs reached their targets better when donors had an intrinsic motivation. However, this deﬁ_{ciency is too minor to} undermine the conclusion that WMB expresses the sentiments of most ment economists and practitioners, and has considerably enriched the develop-ment literature.

Juliette Koning and Frans Hüsken (eds) (2006)

Ropewalking and Safety Nets: Local Ways of Managing Insecurities in Indonesia, Brill, Leiden and Boston, pp. ix + 224. €59.00/US$80.00.

This volume of anthropological case studies reports on a research program that began in 1997, intended ‘to study, at the grassroots, the kind of institutions, mech-anisms and strategies that provided social security and whether and how these had changed in the past decades’ (p. vii). It is largely motivated by the lack of effec-tive state-sponsored social security—’one of the major weaknesses of the devel-opment model of the New Order’—which the editors contend was ‘laid bare’ by the economic crisis of the late 1990s, and which implies that most Indonesians are reliant on these grassroots institutions, mechanisms and strategies.

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Of the seven case studies, only two combine earlier and more recent observa-tions that in fact allow anything to be said about changes over time. Of these, one (Abdullah and White) is not really concerned with social security arrangements, but with the disappearance over time of reciprocal labour arrangements in rice cultivation (though not in house building), under which individuals effectively lend their labour to others with the expectation that this debt will be repaid in kind in the future. The other (Koning, chapter 2) relies on observations only about four years apart, which is hardly long enough to talk meaningfully about changes in these kinds of arrangements over time. Moreover, unfortunately for the study reported in this chapter, the contemporaneous ending of forced sugarcane plant-ing and the introduction of a third annual rice crop had a strong impact, greatly obscuring the impact of the crisis. Unfortunately also for the book as a whole as it relates to coping with the crisis, in each case the village or kampung concerned was either not hit particularly hard or even beneﬁ_{ted from it. This was so even in} villages that exported labour to Jakarta, and so might have been expected to suffer as a consequence of reduced remittances.

Marianti’s chapter on widowhood observes, unsurprisingly, that younger wid-ows tend to be supported by their parents, while older ones are more likely to be looked after by their children. This and several other chapters conﬁ_{rm that,} when misfortune strikes, one is dependent primarily on oneself and one’s imme-diate family. Accordingly, there is much emphasis on families investing in kin and community relationships in the hope of deriving support from these in times of adversity. Interestingly, however, none of the authors mentions marriage as a social security mechanism, even though couples effectively sign contracts to bear the vicissitudes of life together, and quickly set about producing offspring who will later allow these risks to be spread even further.

Lont warns against ‘romanticising ﬁ_{nancial SHOs [self-help organisations], ...} exaggerating solidarity between participants and obscuring institutional limita-tions’. And yet one of the editors (Koning, chapter 7) seems to do precisely that, describing both arisan (rotating savings and credit associations) and sumbangan

(contributions to families to assist with major life-cycle events or misfortunes, with the expectation of reciprocation) as ‘arrangements to manage or prepare against uncertain events’. By and large this is not true (except to the extent that accumu-lated savings can be drawn on to cope with ﬁ_{nancial adversity). The}_arisan_is sim-ply a method of group saving (enhanced by a lottery aspect and, in many cases, by a social aspect), which imposes some discipline on savers by virtue of its group nature, as Lont observes (p. 138). Although their amounts are non- uniform, sum-bangan for life-cycle events are, in principle, little different from arisan contribu-tions, except that here it is the timing of the contributions that is uncertain rather than the timing of the payout (which now coincides with the individual’s own special event). Only sumbangan relating to accidents and illness have the character-istics of social security, but the transfers here are limited relative to cost incurred.

Susanto’s chapter about the minority ethnic Chinese community in Yogyakarta is also not about social security but about this community’s perceived vulnerabil-ity to violence at the hands of the majorvulnerabil-ity, and about how this is exploited by the local military. Individual Chinese nurture good relations with their pribumi neigh-bours; as a community their organisations strive to have good relations with local

pribumi-dominated organisations. Meanwhile, Chinese businessmen take heed of

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hints from military ofﬁ_{cials about the inadequacy of the latter’s budgets. The} Chi-nese of Yogyakarta and most other cities were spared the violence of May 1998. Those in nearby Solo and in Jakarta bore the brunt of it, but the author gives no explanation as to why these mechanisms were ineffective in those two cities.

All in all, readers in fact do not learn a great deal about what is said to be the basic concern of the book, interesting though the studies are in other respects. Nevertheless, at least some authors seem determined to conclude that non-state social security arrangements are defi_{cient and/or have been deteriorating, even} in the absence of convincing evidence. For example, Nooteboom concludes that many villagers ‘had neglected their social relations and networks of mutual help with other segments of society, and within reciprocal relationships, making them extremely vulnerable to rising prices and the risk of unemployment’ (p. 197) as a result of the crisis, but he presents no evidence to support this assertion. Like-wise, the editors’ preface asserts that ‘social security has become a problematic and contested fi_{eld. At the local level, old institutions have weakened and new} ones have emerged where membership has become increasingly exclusionary’. To this reviewer, it is by no means clear on the evidence presented that the observed combinations of income-earning activities and informal social security arrange-ments now are inferior to—as opposed to different from—those of 20 or 30 years ago. Although not stated in so many words, the implicit agenda seems to be that the government should actively implement the new (2004) Social Security Law (or perhaps a modifi_{ed version of it), but the reality is that this law is inherently} inca-pable of guaranteeing social security coverage for tens of millions of Indonesia’s poorest citizens, who, as the book shows, are also those most poorly served by informal social security arrangements.

Ross H. McLeod

Dewi Anggraeni (2006) Dreamseekers: Indonesian Women as Domestic Workers in Asia, Equinox Publishing, Jakarta, pp. 272. US$14.95.

This is a useful book about Indonesian domestic workers in three countries: Hong Kong, Singapore and Malaysia. Written by a journalist and novelist and funded by the International Labour Organization, it presents vivid case studies to illus-trate the range of circumstances in which Indonesian domestic workers ﬁ_nd them-selves. It allows the different actors in the process to tell their stories: not only domestic workers and their employers, but also the Indonesian labour recruiting companies (Perusahaan Jasa Tenaga Kerja Indonesia, or PJTKIs), embassy staff responsible for domestic worker issues, NGOs, and a lawyer who has defended many Indonesian domestic workers in court for committing serious crimes. An Indonesian ambassador, a ﬁ_{rst secretary and a consul general were among those} who gave detailed interviews. The reader gains a more nuanced and complex picture as a result of the varied sources.

For those with a reasonable familiarity with the domestic worker scene in these three countries, the ﬁ_{ndings will not be new: the forces driving Indonesian women} to try their luck as overseas domestic workers; the fact that domestic workers

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from the Philippines are better supported by their government and by NGOs than those from Indonesia; the shortage of designated staff and facilities in Indonesian embassies to deal adequately with the many and complex issues that arise; and the quasi-institutionalised system of predation at Jakarta’s Cengkareng airport, where only the smartest, most experienced and most tough-minded returning domestic workers can expect to emerge with their full savings intact.

The author could be criticised for including a considerable number of high-proﬁ_{le cases of abuse of domestic workers by their employers and of crimes} committed by domestic workers that have received much publicity in the media. Although she does balance them with more mundane cases where the domestic worker enjoys better conditions than in Indonesia, and both worker and employer are satisﬁ_{ed, the shock value of the extreme cases imprints itself more on the} read-er’s memory. On the other hand, these cases were important politically and prob-ably contributed to the introduction of some much-needed reforms.

For those interested in gaining a thorough understanding of the policy issues arising from the ﬂ_{ow of Indonesian domestic workers abroad, this book needs} to be read in conjunction with other works, notably the book edited by Shirlena Huang and others, Asian Women as Transnational Domestic Workers (Marshall Cav-endish Academic, 2005), especially the chapter on Indonesia by Graeme Hugo. Unfortunately, that book, and a number of other useful sources, are omitted from the brief list of further readings at the end of this volume.

Gavin W. Jones

Jemma Purdey (2006) Anti-Chinese Violence in Indonesia, 1996–1999, KITLV Press, Leiden, pp. xvi + 300. €25.00.

Based upon the author’s PhD thesis, this book provides a detailed analysis of vio-lence directed towards Indonesia’s ethnic-Chinese minority. Anti-Chinese viovio-lence has a long if discontinuous history in the archipelago, but it was the fi_{nal years of} the New Order, the focus of this book, in which it took perhaps its most horrify-ing and brutal form. As Jemma Purdey painstakhorrify-ingly illustrates, those identifi_ed as Chinese found themselves forced into an untenable position by the New Order state. Ethnic discrimination enshrined in law prohibited them from participating in national life in ways that could have facilitated acceptance as being fully ‘Indo-nesian’. If civic participation was circumscribed, patron– client relations between state agents and Chinese Indonesian fi_{nanciers known as}_cukong_{facilitated the} latter’s domination of the private business sector.

Some Chinese Indonesians may have had economic privileges but, as Purdey demonstrates, they had few political rights. Through cukong arrangements the New Order exploited the vulnerability of Chinese Indonesians, using them as scapegoats for its own economic mismanagement. There was tacit encourage-ment of racial stereotypes that caricatured Chinese as rich, greedy and corrupt. These stereotypes became a conduit for redirecting anger about the state’s failure to deliver on its promise of economic and social ‘development’ for the country’s millions of poor away from its ‘logical’ target and towards a vulnerable minority

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group. As Purdey shows, this intensiﬁ_{ed in the late 1990s as the regime began to} fracture.

The book is divided into three chronological sections consisting of six chap-ters in total. An introductory chapter provides the historical, social and politi-cal context of anti-Chinese sentiment in Indonesia, as well as a consideration of some of the theoretical implications of violence framed in ethnic terms. Begin-ning in 1996, chapters 2 and 3 chart the intensifi_{cation of anti-Chinese violence} through focused case studies. Purdey carefully identifi_{es the links between} spe-cifi_{c instances of violence in Situbondo (East Java) and Rengasdenglok (West} Java) and the broader political transformations that were taking place nationally. What linked the impunity of the perpetrators, the complicity of state authori-ties and the almost fatalistic resignation of the victims was the extent to which violence towards Chinese was considered ‘normal’, even by Indonesian Chinese themselves.

The second section of the book details the dramatic ‘climax’ of this violence, the May 1998 rioting that precipitated Soeharto’s departure. To avoid ‘Jakarta-centrism’, Purdey focuses her narrative upon Medan and Solo. In contrast to previous localised outbreaks, the May riots displayed high levels of premedita-tion and coordinapremedita-tion on a napremedita-tional scale. The previous ‘limits’ of anti-Chinese violence were breached; not just material interests were attacked but also physi-cal selves, most horrifyingly in the targeted gang rapes of Chinese Indonesian women. One immediate consequence of this was a massive fl_{ight of capital, as} Chinese Indonesians fl_{ed the country or transferred money to overseas accounts.} This further undermined the legitimacy of a regime fl_{oundering from the effects} of the 1997 economic crisis. Opinion remains divided as to whether this was intentional or a grave miscalculation on the part of those who orchestrated the violence.

The third part of the book looks at the politics of ’representing and remember-ing’ the May violence, and the impact of regime change. Chapter 5 examines the outcomes of the government-initiated Joint Teams Report into the May violence. Purdey argues that the report was ground-breaking both in its acknowledgment of state-sponsored terrorism and in its ‘fl_{awed’ nature, introducing the notion of} multiple truths in offi_{cial accounts of violence. Chapter 6 considers the sporadic} spasms of violence against Chinese Indonesians that continued after Soeharto’s departure, with the narrative ending in late 1999. Though in 2007 legal discrimi-nation still exists, it is signifi_{cant that since 1999 there has been a relative lack of} specifi_{cally anti-Chinese violence. Is this because it was the product of} particu-lar structural and political dynamics that have since dissipated? Has reactionary violence simply found newer, more politically expedient targets? The reasons behind this absence warrant greater consideration.

Overall, what sets this study apart is Purdey’s meticulous attention to detail. Through thorough archival research of the Indonesian media and other second-ary sources, together with some fi_{rst-hand interviews, the author constructs} multi-faceted accounts of the violent episodes and periods covered. She brings life and complexity to the narrative, not glossing over crucial specifi_{cs for the} sake of showing the bigger picture. Root causes of the violence and the different levels of agency are identifi_{ed, and the contradictory accounts of stake-holders} and actors are allowed to speak for themselves. At the same time Purdey avoids

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alienating readers not familiar with the minutiae of Indonesian politics by situ-ating the case studies in a broader analysis of the social, political and economic dynamics that foster these forms of ethnic and ethnicised violence. It is this combination that makes the book an engaging read and a valuable contribution to the ﬁ_eld.

Ian Wilson

Hadi Soesastro, Clara Joewono and Carolina G Hernandez (eds) (2006)

Twenty Two Years of ASEAN ISIS: Origin, Evolution and Challenges of Track Two Diplomacy, Centre for Strategic and International

Studies (CSIS), Jakarta, pp. xiii + 201. Rp 50,000.

This volume is a valuable and illuminating examination of the constructive rela-tionship between ASEAN governments and the ASEAN Institute of Strategic and International Studies (ASEAN ISIS), an informal association of think-tanks of the region. The book is dedicated to one of the association’s founders, the late Dr Noordin Sopiee of Malaysia. The chapters, written by long-standing participants, describe its development into an effective ‘Track 2’ (non-ofﬁ_{cial) mechanism for} international diplomacy and policy making.

What does this mean?

The effectiveness of ASEAN ISIS is based on mutual respect between govern-ments and members of the think-tanks. The relationship relies on understanding of current ofﬁ_{cial policies and of the constraints on political decision making,} com-bined with a patient effort to steer government policies in consistent directions.

To sustain such a link, those in the ASEAN ISIS network have created a clear sense of Southeast Asia’s long-term interests, internal as well as international. They have been able to draw on a range of ideas, sometimes adapting concepts developed elsewhere, and using them to devise recommendations that can have practical effect—not necessarily expecting immediate acceptance, but avoiding the trap of letting the best be enemy of the good.

As the chapters explain, it is not easy to make judgments about how far to depart from, or be ahead of, current policy. The need to balance capacity for inﬂ u-ence and independu-ence interacts with the need for funding. In Southeast Asia there are few domestic private sources of funds for policy-oriented research. The need to rely on government or international funds risks perceptions of being unduly inﬂ_{uenced by one or the other.}

ASEAN ISIS has proved inﬂ_{uential in shaping ASEAN’s approach to economic} integration, bringing civil society into political discussion (including by nurtur-ing the ASEAN People’s Assembly) and drawnurtur-ing attention to the need to respect human rights as part of ASEAN’s promotion of a comprehensive concept of secu-rity. It has also inﬂ_{uenced the nature of the ASEAN Charter, which is expected to} be adopted in late 2007.

Several authors note that the pre-eminence of ASEAN ISIS as adviser to ASEAN is somewhat unusual. Some even see the network as the pioneer of the concept of Track 2, but they fail to explain how that proved possible. Modesty may account

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for this shortcoming. Those who have been involved do not fl_{aunt their in}fl u-ence: they are very ‘matter-of-fact’ about achievements and frank about chal-lenges, but do not talk about their personal roles. It has been left to non-ASEAN authors to provide any sense of how diffi_{cult their tasks are and of the} impres-sive foresightedness, persistence and sensitivity that have been needed to make headway.

Modesty also prevents authors from dwelling on the value of their individual institutions. Several members of ASEAN have well-regarded think-tanks that have developed a relationship of mutual respect with their governments. These institutes have created the precedent for a productive relationship with their gov-ernments and an ability to inﬂ_{uence both domestic and international economic} and security policies.

In that sense, ASEAN ISIS did not invent Track 2, but moved it from a domestic to a regional level. That has allowed the network of thinkers to inﬂ_uence collec-tive as well as individual decisions of ASEAN governments.

Andrew Elek

Janet Steele (2005) Wars Within: The Story of Tempo, an Independent Magazine in Soeharto’s Indonesia, Equinox Publishing, Jakarta, and Institute of South East Asian Studies (ISEAS), Singapore, pp. xxxiv + 328. Paper: S$29.90; US$16.95.

The stand-out news publication in Indonesia in the 1970s–1990s was the famous weekly, Tempo, founded in 1971, banned amid controversy in 1994, and revived after former president Soeharto’s fall in 1998. It is still going strong in 2007. Janet Steele’s study of Tempo provides a highly readable, informative and evocative account of this magazine’s history, set within a wider picture of how the media reported events under stiﬂ_{ing pressures to to avoid criticism of the regime.}

Tempo specialised in national politics and economic news. It was born out of the student movement at the beginning of the New Order. Its ambiguous, con-tradictory status, as a part of the New Order but also one of its critics, is a theme addressed throughout the book. Tempo was sympathetic to the economic policies of the ‘technocrats’, and counted several among its close friends.

Janet Steele ‘caught the Indonesia bug’ in 1997. She came to teach as a Fulbright professor, but ‘to my surprise it seemed that nearly everyone I met in those ﬁ_rst few weeks had some connection with Tempo’. She came back to do 15 months research on Tempo, becoming an insider.

This is a well told tale, combining personal accounts with solid analysis. Chap-ter 1 is a study of the Tempo community, the reporters, and their backgrounds and ideas. Chapter 2 (‘The Poet’) is a study of founding editor Goenawan Mohamad. Chapter 3 sets the establishment of the magazine in a wider study of the New Order and the politics of 1971–74. Chapter 4 examines the strategies employed, within and without, to remain independent from the New Order, taking the story up to Tempo’s ﬁ_{rst short banning in 1982. Chapter 5 examines the dilemmas of} reporting the 1984 Tanjung Priok killings, within the context of Islamic renewal in Indonesia.

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Chapter 6 provides a content analysis of stories up to the 1994 ban; chapter 7 examines the readership and its ‘middle class’ nature, one tool being an analysis of advertising. Chapter 8 uses the ‘exodus’ of Tempo staff in 1987 (to form a rival magazine, Editor) to analyse the tensions caused by Tempo’s transformation into a successful business enterprise. Chapter 9 covers Tempo’s banning in 1994, and the vigorous underground press that it fostered until the fall of Soeharto in 1998. An epilogue leaves Tempo in 2004, ﬁ_{ghting for its life against a legal suit from} businessman Tommy Winata.

This is a powerful book, managing to be personal, analytical, well constructed and a good read—an excellent introduction to the world of Indonesian press reporting.

David Reeve

Rajeswary Ampalavanar Brown (2006) The Rise of the Corporate Economy in Southeast Asia, Routledge, London, pp. 416. Cloth: £85.00.

This book deals with the growth, governance and ﬁ_{nancing of large corporations} in Southeast Asia. It uses a case study approach, with the cases drawn from Indo-nesia, Singapore, Thailand, the Philippines and Malaysia. In my view it is unsat-isfactory, because the information provided is generally not organised in a useful way, and its relevance to the conclusions drawn is seldom obvious.

These problems are illustrated by chapter 3, which deals with the Indonesian fi_{nancial sector and covers bank failures, from those of individual banks in the} early and mid-1990s to the notorious collapse of most of the banking system in the Asian crisis. One of Brown’s main hypotheses is that ‘the major defects in the fi_{nancial system required only a tiny external pressure for the edi}fi_{ce to} crumble’ (p. 73). I think that the speculative attacks on emerging market curren-cies and fi_{nancial systems that followed the Bank of Thailand’s decision to allow} the baht to depreciate were much more than a ‘tiny external pressure’, and that the role of poor governance has been better documented and analysed in other studies.

Brown acknowledges that many other accounts of the Asian crisis have emphasised the role of poor governance, but seeks to differentiate her study from the rest of the literature by arguing that the other accounts ‘have provided no detailed corporate empirical evidence or analysis’ (p. 48). To fi_{ll this gap, she} provides fi_{nancial data on around 20 variables (several designated by unde}fi_ned acronyms) on a year-by-year basis for six banks. The quality of these data is very dubious, and there is no obvious connection between them and the conclusions that Brown draws. Indeed the facts cited in the text are seldom based on the data in the tables. For example, she states on p. 67 that Bank International Indonesia (BII) failed in April 1998 and on p. 69 that it ‘… collapsed in 1997. The bank’s reserves and provision for bad debts rising from Rp 125,631 million in 1995 to Rp 518,449 million in 1997 could not cover their [sic] high exposures to foreign exchange contracts, both in Indonesia and abroad (see Table 3.8)’. In fact, table 3.8 does not contain any information on foreign exchange contracts, or on the

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level of reserves and provision for bad debts. The table does however report a return on equity (ROE) of 10% in 1997 and 130% in 1998. How a bank can fail despite having such an apparently healthy ROE is a mystery that Brown does not discuss. My guess is that the ROEs reported in table 3.8 have been uncriti-cally taken from ﬁ_{nancial statements issued by BII that were designed to be} misleading.

George Fane

BRIEFLY NOTED

Peter Boomgaard, David Henley and Manon Ossewijer (eds) (2006)

Muddied Waters: Historical and Contemporary Perspectives on Management of Forests and Fisheries in Island Southeast Asia, KITLV Press, Leiden, pp. 350. €35.00.

The main goal of this well written book is to compare the historical relationships between people and environment in island Southeast Asia (Indonesia, Malaysia and the Philippines), with a view to identifying some of the preconditions—insti-tutional, economic, demographic and ecological—for sustainable resource use (p. 2). Forests and ﬁ_{sheries were selected as the focus because the issues involved} in managing these two industries for resource sustainability are to some extent similar.

Of the 16 chapters, 11 deal with Indonesia. The fi_{rst such chapter, by James Fox,} argues that signifi_{cant forest and}fi_{sheries depletion is happening within a single} generation. Peter Boomgaard contributes two chapters, one on fi_{sheries and the} other on forestry, describing the general historical relationships between people and these resources in Indonesia. The book then provides chapters focusing on issues of conservation (by Julia Arnscheidt on fi_{sheries and Gerard A. Persoon} and Erik Wakker on forests). The other six chapters on Indonesia present various case studies of people–fi_{sheries or people–forest relationships.}

Hal Hill and João Saldanha (eds) (2006) Membangun Negara Baru: Timor Lorosa’e

[Building a New Nation: Timor Lorosa’e], Aksara Karunia Publishers, Jakarta, pp. xxxii + 570.

This is the Indonesian translation of Hal Hill and João Saldanha (eds) (2001)

East Timor: Development Challenges for the World’s Newest Nation, Institute of South-east Asian Studies (ISEAS), Singapore, and Asia Paciﬁ_{c Press, ANU, Canberra,} which was reviewed in the April 2002 issue (BIES 38 (1): 124–6).

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