Having analysed past experience from the terrible bloodbath of 1965 through to the movement that overthrew Soeharto, in part two of their perspectives document the Indonesian Marxists look at the present situation facing the working class. Is there such a thing as a “progressive bourgeoisie” in Indonesia today? What is the impact of the crisis on the Indonesian economy and what are the prospects for the coming period?

The bourgeoisie now

Protest against fuel price hikes in Jakarta in 2008. Photo: Henri IsmailProtest against fuel price hikes in Jakarta in 2008. Photo: Henri IsmailAfter the hammer blow of the 1998 movement, the bourgeoisie could no longer rely on a system based on a monolithic party. The masses have decisively rejected GOLKAR and it is unlikely to ever regain its past glory. So, what we have now is a bourgeois multiparty system, where we have 6-8 parties each gaining between 5-20% of the votes. Not one party holds a majority. The 1998 blow has still left the ruling class fractured, but at the end of the day they all still band together. Immediately after the 2009 election, six parties formed a coalition giving them a majority of 421 seats out of 560.

The Massa Aksi in 1998 had also delivered a huge blow to the bourgeois state. Even though many of its reactionary laws are still in place, the state can no longer openly implement them. The army and the police can no longer be used openly and arbitrarily to crush the movement. However, when the movement becomes a potential threat, the state employs all its machinery to repress it. The attempt of PAPERNAS to run in the 2009 election was one example; the party was not only prevented from participating through electoral regulations but also physically attacked.

The military was still intact. While formally the Dwifungsi ABRI has been dismantled, its real structure, the Military Territorial Command (KODAM, KODIM, KOREM, KORAMIL, BABINSA), is still in place. It is also still dominant in politics. We only need to remind ourselves that the current president of Indonesia is a military man.

However, it would be wrong to think that because the ruling class is fractured into many different parties that it is therefore weak. On the contrary, the forces of New Order are becoming more confident. Now it can impose the dictatorship of capital under the disguise of democracy. They have even gone as far as proposing to grant Soeharto the status of national hero. Such action would not have been possible five or ten years ago.

Indonesia in the global economic crisis

While the economic indicators seem to point to the fact that Indonesia is on a recovery track after being hit by the 2008/2009 global financial crisis, this is built on very shaky ground. The major capitalist countries are experiencing a jobless recovery, and some countries have even entered into a new crisis. Recently Greece plunged into a crisis that shook the world economy despite the hopeful assurances of the bourgeois commentators that the crisis in Greece, albeit a small country, would not affect the global economy. At the beginning of the Greek crisis, the Indonesian government was confident that its economy would not be affected. However, from April 30 to May 24, the IHSG (Jakarta Composite Index) dropped from 2971 to 2514, more than 15% in 3 weeks.

The Greek government has been forced to implement an austerity measure, cutting their budget by 30 billion euros over three years. Workers are being asked to pay for the capitalist crisis. Spain, Portugal, Ireland, Italy, and Britain – which are larger economies than Greece – are in a similar situation. On May 29, Spain followed the step of the Greek government, passing an austerity plan that will cut 15 billion euros spending which includes a pay cut for civil servants. This is on top of the 50 billion euro austerity package announced earlier in January. The new Cameron-Clegg coalition government in Britain, on May 24, after just two weeks in power, took its first steps in attacking the workers by announcing 6 billion pounds of spending cuts. On May 26, the Italian government under Berlusconi unveiled a plan to slash 24.9 billion euros from their state budget, which includes a three-year wage freeze for public sector workers. On May 13, the Portuguese government announced tax increases and spending cuts. All these austerity measures have been met with demonstrations, however none as big as the ones we have been seeing in Greece.

The world economy is slowly emerging from the biggest economic crisis since the 1930s. However, there won’t be a return to “normality”. The crisis marks the end of an epoch; economically it marks the end of a welfare-state epoch and politically it signifies the end of Francis Fukuyama’s “end of history” epoch. As the above picture has shown, we are entering the age of austerity. An outright depression from the 2008/2009 recession was averted by an unprecedented bailout, estimated to be in the region of $14 trillion. John Hawksworth, PwC’s head of macroeconomics, explained: “We have been able to survive this major economic shock by throwing money at it. But who is to say in ten years it won’t happen again? So we should be planning to get back into surplus so that we have some money to throw at it [next time].”

The IMF has pointed out that governments around the world have added, on average, a debt load of 20% of GDP and are projected to add another 20% by 2015. The IMF advice to the G20 countries is massive cuts in expenditures to the tune of 8.7% of GDP.

Economically, this will mean that there will be a period of jobless recovery, with lower demand. While Indonesia’s economy is not as reliant on exports as other Asian economies, the prolonged slump in export demand will destroy Indonesia’s home industry. Already the Indonesian government is trying to overcome this lowering of export demand through free trade agreements such as ACFTA (ASEAN-China Free Trade Area) and AIFTA. However, this wishful thinking will be shattered immediately. China and India also have had their export markets cut due to the crisis, as the demand from North America and Europe has fallen, thus they also seek to open new markets for their exports. Being a weaker economy, Indonesia will not be able to compete with the products from China and India.

Capitalism has developed an unsolvable contradiction; on the one hand there is the contradiction between private ownership of the means of production and the collective social character of production itself, and on the other hand there is the contradiction between the nation-state and the international character of the economy. Free trade and protectionism, implemented to varying degrees in different countries depending on the correlation of economic forces of those countries, are the methods that the capitalists use to overcome these contradictions. In extreme cases, they resort to military measures: the two world wars and the numerous “small” wars in the course of last century.

What is needed is the free exchange of the fruits of the people labour’s carried out in the interest of the workers and peasants not for the profitability of private capital, which can only be achieved if the means of production and distribution are expropriated out of the hands of the capitalists and put under the democratic control of the workers and peasants. Socialist countries can then democratically and voluntarily enter into trade with each other not with the purpose of conquering each other’s markets and squeezing profit for private capital, but to fulfil human needs.

The socialists in Indonesia will have to start from the demand against free trade agreements (ACFTA, AIFTA, etc), as this is the natural reaction of the workers and peasants who rightly see such agreements will hurt their livelihoods. However, starting from this “minimum” demand we have to connect it to a socialist perspective, to the question of power. We have to say no to capitalist free trade, and also no to capitalist protectionism. The capitalist regime of SBY cannot be trusted to deal with the current economic crisis, as we have seen how the “Reformasi” government dealt with the 1997/98 economic crisis by auctioning off state properties and increasing exploitation, i.e. by forcing the workers and peasants to pay for the crisis. The only solution is for the Indonesian workers to be in power under a socialist programme, with the creation of the Socialist Federation of South East Asia, reviving Tan Malaka’s demand of United ASLIA (Asia-Australia).

The crisis and mass consciousness

A crisis can have a dampening effect on the mood of the masses, and this is what we are seeing in general now. At the moment, we are not seeing massive worldwide mobilation after the recent recession. This is because the economic cycle and consciousness do not have an automatic proportional relationship. This is similar to the 1929 Great Depression that forced the wider mass of workers to lower their heads instead of mobilising. Only in 1934 did the workers start to move, once there was the beginning of a recovery.

Added to this is the weight of history on the shoulders of the world working class: with the ossification of reformism for a whole generation since the post world-war boom and the fall of the USSR which was accompanied by a capitalist ideological offensive. This has created a whole period filled with confusion and ideological backsliding. Alien ideas penetrated the workers’ movement. Pessimism and cynicism became prevalent with many people deserting the movement altogether, leaving the movement in the hands of reformists and careerists of the Blair type.

During this very difficult period, our international tendency stood firm; maintaining the banner of Marxism and a revolutionary class policy when everyone was abandoning it. Events have proved that we were right. We are now living in a period of turmoil, economically and politically. This period is shaking the consciousness of the working class which was burdened with reformist illusions and pessimism in the past. However, more importantly, it is creating a new generation of a young working class which is completely free from reformist illusions. The new period of austerity will create for the first time in the history of capitalism a new generation of youth who will not have a better living standard than their parents. This will be a new generation which will be raised in a period of turbulence, with wars, revolutions and counterrevolutions unfolding across the world. In Indonesia too, a new generation is emerging, one which has never lived through the period of reaction under Soeharto, one which has witnessed the failure of “Reformasi”, and now the failure of capitalism worldwide.

Economically, in a broad historical sense, the objective situation for socialism has been ripe and mature for some time. However, what is lacking now, and has been lacking, is a revolutionary leadership with a correct idea. The past half century saw the leadership of the movement in the hands of reformists and Stalinists – the latter is actually nothing more than a revolutionary phrase-mongering form of reformism. In the coming period, the leadership of the movement most likely will still be in the hands of the reformists as the forces of Marxism are still too small. However, the masses will learn through experiences and see the blind alley of reformism, and will either force their leaders far to the left or remove these leaders and place new ones in their place. During this period, the ideas of Marxism will start gaining ground. This will be a protracted process – not in months but maybe in years or decades – with leaps and bounds, but the direction is clear. The most advanced layers of workers and youth will find themselves moving towards revolutionary Marxism.

The “progressive national bourgeoisie”

The history of Indonesia (see Appendix “The History of Capitalist Development in Indonesia”) has shown that since the 16th century the social, economic, and political development of the country has been linked to the birth and development of capitalism. It is because of this that Indonesia’s class development has never followed the “classic” class development of the advanced capitalist countries. Even Indonesia’s feudalism was affected by Dutch rule as the colonial rule brought the feudal rulers to their knees and then used them as their local ruling agents, tying them to imperialism.

And what of the national bourgeoisie? The national bourgeoisie came too late on the scene of history in Indonesia, and they were born under the yoke of imperialism, which did not make them more progressive in any way but subservient to imperialism and foreign capital.

It is instructive to see how the nationalist movement in Indonesia was born in the early 20th century. The Indonesian nationalist movement was initially led by intellectuals who rested upon the peasants and the newly emerging proletariat (mainly plantation workers, railway workers, pawnshop clerks). The Indonesian bourgeoisie was non-existent in the nationalist movement from the beginning. The nascent Indonesian bourgeois, i.e. the small merchants and traders, formed Sarekat Dagang Islam (Islamic Commercial Union) in 1911. But its original purpose was to protect the interests of Javanese batik merchants from the increasing competition from the Indies Chinese traders, and not to advance the liberation of the East Indies people from Dutch rule. Within a year this organation caught the popular imagination of poor peasants and workers of Indonesia who flocked to it in the thousands and overwhelmed the merchant base of the organation. In 1912, the SDI dropped its commercial name – and effectively its merchant base – to become Sarekat Islam (Islamic Union), the first mass political movement in Indonesia which became the mass basis for the Indonesian nationalist movement. The only political party that was of any serious significance at that time was the Indonesian Communist Party, who oriented and was rooted within the Sarekat Islam. So, while SI was the mass basis of the first nationalist movement in Indonesia, the PKI was the only party that provided the Indonesian nationalist movement with a coherent political expression.

The demise of SI and the PKI in 1927 opened the stage for bourgeois-nationalist elements to dominate the movement, albeit this being a period of semi-reaction where the nationalist movement was thrown back. However, there was still no bourgeois class in Indonesia. Instead what we had were intellectuals with a bourgeois nationalist ideology but without a strong native bourgeois class to lean on.

The 1945-49 independence struggle reveals again the reactionary character of these bourgeois-nationalist leaders. They were content at having Indonesia under the Dutch crown and the economic rule of the imperialist forces. The programme of 100% independence was betrayed by the likes of Soekarno, Hatta, and Sjahrir, marked by the signing of the Hague Agreement in 1949.

The bourgeois class started to crystalle after the period of sturm und drang of 1945-1949. Born too late, the Indonesian bourgeoisie was too weak to play any role – let alone a progressive role   and when they did play a role, they sided with Soeharto and the foreign capital behind him in the bloody massacre of millions of Indonesians. The PKI paid a heavy price for their wrong two-stage policy, whereby they subordinated the class struggle to the national struggle and thus sought an alliance with the “progressive” national bourgeoisie. The problem is that there was no progressive national bourgeoisie, not even its shadow. This alliance with the bourgeoisie meant the subordination of the working class programme to the interests of the capitalists, postponing the question of workers taking power, and effectively disarming them. When the reactionary generals struck, not one element of this national bourgeoisie rallied to defend the PKI or stop the massacre of the poor workers and peasants.

In the 32 years under the military dictatorship of Soeharto, the Indonesian national bourgeoisie never lifted a finger to defend even a “bourgeois parliamentary” democracy, which is supposed to be the basic classic task of the bourgeoisie. Instead, they were complicit in the dictatorship. Politically they were impotent and the army had to literally run the government. Economically they are tied to foreign capital, and when they do bark against foreign capital it is only to get a bigger slice of the pie from the exploitation of the workers and peasants, not because of any genuine aspiration to liberate the people from the yoke of imperialism as some on the Left would like to think.

To this day we are still waiting for the arrival on the scene of a “progressive national bourgeoisie” in Indonesia. Some on the Left try to find this class in the person of Rizal Ramli, Prabowo, and others who use nationalist rhetoric. It was not long ago that similar hopes were put on the shoulders of Megawati, Amien Rais, and Gus Dur, who later dashed this hope and earned the nickname “false” reformists. However, there is no such thing as a false reformist. These bourgeois reformers are doing exactly what their historical task is: saving capitalism when it is in its gravest danger.

The National Question

The national question is also still a major issue. Historically, the creation of a united nation state has been the task of the bourgeoisie. In Indonesia, the nation state was created through the struggle against Dutch colonialism. However, under the framework of capitalism, the nation state was put under tremendous pressure. The voluntary union of all different nationalities and ethnicities has turned into its opposite: forceful unity for economic exploitation under the slogan of “Bhinneka Tunggal Ika”. Regions outside Java have been stripped of their resources and trillions of Rupiah are transferred to Jakarta, the ruling centre of the capitalist. Poverty is tens of times higher outside Jakarta. In the official figure from 1990, the poverty rate in Jakarta was 1.3% while in NTT it was 45.6%, NTB 27.6%, Papua Barat 12.6%, and so on.1 Any dissatisfaction is quickly smashed with the might of the bayonet. Not only economic exploitation, we also see cultural and linguistic repression, where hundreds of ethnicities have been forced to assimilate into Indonesian nationalism and their cultures are reduced to tourist attractions and sterile showcases in TMII.

Indonesia has become a prison house of nationalities. The unity of Indonesia is under real threat with the prospect of turning into a new Balkans. The bourgeoisie has failed to maintain the unity of Indonesia. It has failed to fulfil the main task of the bourgeois democratic revolution.

Whatever unity that came out of the struggle against Dutch colonisation has been squandered by capitalism. This is our starting point. In several provinces, the aspiration for national liberation from Indonesia amongst the toiling masses has become a reality, notably in Aceh and Papua. We oppose any kind of oppression against nationalities, cultures, language and religion. We stand in full solidarity with the oppressed nationalities in their struggle to liberate themselves from the Indonesian prison house. Concretely, this means that we defend unconditionally the democratic rights of the oppressed nationalities to self-determination, up to and including the right to separate.

However, we stand clearly for a class policy. This means that it is our task to point out to our brothers and sisters in Aceh and Papua that their true ally in their liberation is the Indonesian working class. The bourgeois class in Aceh and Papua cannot be trusted and relied on to lead the national liberation movement. When the bourgeois leaders of Aceh and Papua talk of independence from Jakarta, they only wish to exploit their own people without the interference from Jakarta, they only want a bigger share of the pie of exploitation.

One way to win over the trust of our oppressed brothers and sisters, to cut across the national question with the class question, is exactly to tell them that we support their right to self-determination, even their right to separate, and that we will fight to form a workers’ government that will give them that full right to self-determination. With this position, we are telling our brothers and sisters that the Indonesian workers have no interest in oppressing them.

The experience of East Timor is a testament to the fact that genuine liberation cannot be achieved under capitalism, and that the genuine liberation of nationalities in Indonesia is tied to the fight. More than 10 years after independence East Timor’s population is amongst the poorest in the world. It has become a source of intrigues between imperialist powers (Australia, Portugal, China, US and others) to access the vast gas and oil reserves and it is facing growing repression by its own “national government”. Without a change of system in Indonesia, liberated provinces will still be under the economic and political domination of Indonesian imperialism. The only way forward is the formation of a voluntary union of the Socialist Federation of Indonesia, as a first step towards the Socialist Federation of South East Asia and the World Socialist Federation.

Socialism the only way forward

The Indonesian bourgeoisie and the nationalists have proven themselves incapable of moving society forward. They couldn’t even complete the classic tasks of the bourgeois democratic revolution: agrarian reform, genuine national independence, and democracy. Sixty-five years have passed since the proclamation of Indonesian independence, and none of these tasks have been completed.

The question of land for the peasants is still a pressing problem. The current bourgeoisie, due to its economic position, cannot be expected to carry out a thorough agrarian reform. While in the past the bourgeoisie in the advanced capitalist countries had an interest in putting an end to feudalism, today the Indonesian bourgeoisie are often big landowners themselves.

The task of achieving national independence from the yoke of imperialism is also something that cannot be carried out by the Indonesian bourgeoisie. They are too dependent on foreign capital. Since their birth, they have been happy to be the local busboy of imperialism. Every now and then these bourgeoisie squirm and bark when they feel that they are entitled to a bigger share of the pie, piggybacking on the discontent of the masses in order to use them as a battering ram against their foreign master. Politically impotent, the national bourgeoisie can only lean on the strength of the toiling masses. However, their fear of the rising of the workers and peasants is greater than their aspiration to independence. Once they have gained a concession from their master, they drop their nationalist rhetoric and goals.

On the question of democracy, the historical record of the Indonesian capitalists speaks for itself: 32 years of silence – and even active participation – when basic democratic rights were trampled under Soeharto. Bourgeois democratic rights as seen in advanced capitalist countries are still beyond reach despite the 1998 Reformasi.

It is from here that we define the nature of the coming revolution in Indonesia. The incompleteness of the bourgeois democratic tasks means that the next revolution in Indonesia will have bourgeois democratic characteristics, in the sense that it will have to solve the historical tasks of the bourgeois revolution: agrarian reform, democracy, and national independence from imperialism. The problem is that we do not have a bourgeoisie that can carry out these tasks. The working class is the only class that can therefore carry out this bourgeois democratic revolution. However, the working class, once in power, and in order to carry out these tasks, will proceed directly to the socialist tasks, thus connecting the bourgeois democratic revolution with the socialist revolution.

When we speak of the working class, we mean the social class of wage earners. This is different from the urban poor, an unstable and quite heterogeneous social group prone to social explosions but not capable of becoming the vehicle for the socialist reconstruction of society. Only the working class has this quality, due to its position in production which gives it collective discipline, consciousness, action and organisation which no other class possesses. The working class does not need to be a numerical majority to have a decisive political weight. Even as a minority in Indonesian society it can and must play a leading role in the struggles ahead and become the lever of the socialist revolution. In Russia in 1917 the working class was relatively smaller than in Indonesia today and nevertheless was able to play that role.

In the process of coming to power, the working class will meet resistance from the capitalists – both domestic and foreign. In the course of this struggle, the question of power will be put squarely before them, in the factories and in the state. The bourgeois state is a machinery designed for the rule of the bourgeoisie over the toiling masses, and thus for the toiling masses to be genuinely in power they cannot use the same machinery. Therefore the abolition of the bourgeois state and the creation of a new state – a workers’ state – becomes the order of the day. This is a socialist task.

The bourgeoisie will also use their economic power to resist the workers coming to power. The only way to disarm the bourgeoisie is to expropriate the big capitalists. In addition to that, the wider implementation pro-working class policies (trade union independence, 8-hour day, living wage, pensions, etc) by the new workers’ government will be met with economic sabotage (for example capital flight) by the capitalists. Here, the slogan “factory closed factory occupied” will become concrete. The occupation of factories by workers, the setting up of factory committees, and nationalisation by the new workers’ government will become the order of the day. This is a socialist task.

More important also is the need to create decent jobs for the 20 million Indonesians who are out of work and another 60 million who are forced into the informal sector. This basic task of providing jobs for everyone would require massive economic mobilisation of the whole country, which cannot be achieved without a planned economy under the democratic control of the toiling masses. In this era of finance capital and monopolies, a planned economy can only be achieved with the nationalisation of the banks and the big businesses. This is a socialist task.

The Indonesian proletariat is a minority amongst the toilers in Indonesia. Thus, the workers have to be able to win the other oppressed sectors of society (the poor peasants, fishermen, urban poor, unemployed) to their banner. One way of doing this is to seriously embrace their struggles and explain that the solution to their problems is through the working class programme. The task of creating jobs for the unemployed and urban poor can only be carried out through a nationalised planned economy. Genuine agrarian reform can only be achieved through the nationalisation of the property of the big landowners. Cheap credit can only be granted to poor peasants and fishermen when the banks are nationalised. The nationalised industries will be able to provide cheap tractors, fertilisers, etc for the peasants. In essence, it is the concrete realisation of the slogan: “Workers in power, people will prosper”. To win over the other oppressed sectors of the population, the workers have to provide a determined leadership.

Hence, we see concretely how the bourgeois tasks are connected directly to the socialist tasks. As Lenin said, there is no “artificial Chinese wall” that separates them. The pace and the thoroughness of the flowing over from the bourgeois revolution to the socialist revolution are dictated by two main things: first, the degree of preparedness of the proletariat, moreover the degree of preparedness of its vanguard, of its leadership; second, the prospect of socialist revolution in Southeast Asia and the world. Indonesia by itself does not have a sufficient productive level to be able to build socialism. It needs revolutions in other countries which can then provide mutual economic and technical aid to fulfil the socialist tasks. We cannot build socialism with low productive forces. Like Marx said, “with generalised want, all the old craps will return”. The Indonesian proletarian can make the first breakthrough by carrying out a socialist revolution, which can then spread and burn red the whole region, and even the whole world. A working class which is conscious of this historical task and prepared with a clear programme, this is what we need to build.

The Task Now

The socialist forces around the world are still small and weak, and in Indonesia still very young. However, we are entering a period of convulsions which will open a historical opportunity for us. While there is a sense of urgency to move forward, we should also have a sense of proportion. Our task now is to patiently explain. Serious workers and youth who are looking for a revolutionary alternative will not be satisfied with simple agitational slogans. They want explanations. They want a clear and strong ideology so that they can see through all the confusion.

Our orientation is clear: towards the working class. The 1998 movement has opened up space for the workers’ movement. The next task is to consolidate this gain. The workers need their own independent trade union, one which is free from the state and free from the NGOs as well. The strengthening of the organisation of the workers is the next step, ideologically and organisationally. The 32 years of Soeharto dictatorship have robbed the movement of its traditions, and this is not a small matter. This still has to be overcome.

Trade unions are not the only organisations that the worker needs to build. The workers also need their own political party, with a working class programme and a perspective of taking power. The 40% abstention rate in the 2009 election, an increase from 20% in the 2004 election and 10% in the 1999 election, is a clear indication that the masses have increasingly come to realise that there is nothing fundamentally different between all the current political parties. The boycott of the bourgeois elections has to be transformed into a movement to create a political party based on the workers, peasants and urban poor. Furthermore, this party should be built on the basis of class independence with a clear socialist programme: nationalisation of the main industries under workers' control, land distribution for poor peasants, a just fishing law favourable to the small fishermen, cancellation of the foreign debt, free universal healthcare and education, jobs for all with a living wage, a decent pension for all, and the right to organise and strike.

The trade unions should take the initiative and leadership in building this party and put forward the slogan “Workers' party for the workers”. This workers' party should then embrace the peasants and the urban poor, but never the so-called “progressive” bourgeoisie. The party should not fall into the prejudices of the petty bourgeoisie but maintain a clear workers' leadership. Only through the leadership of the workers can the whole of the oppressed layers of society be freed. This has to be agitated for widely in the workers’ movement.

This perspectives document is a first draft. It provides a general perspective from which our day-to-day tasks will flow. It is incomplete as much as it only gives us the first stepping stone and it will be fleshed out more and more as we start moving forward and putting it into practice.

Our party is destined to play an important role, as long as we stick to our ideas steadfastly and have a sense of proportion. The coming period will open up so many opportunities for us, but we have to keep our head cool and consider the size of our force. We are still struggling to build the first nuclei of our party. We have the best arsenal which is the ideas of Marxism, and we also have history on our side. The future is for the working class to claim.

July 6, 2010


1 Hal Hill, The Indonesian Economy (Cambridge: Cambridge University Press, 2000) 226.