Fall of Suharto
In 1970, corruption prompted student protests and an investigation by a government commission. Suharto responded by banning student protest, forcing the activists underground. Only token prosecution of cases recommended by the commission was pursued. The pattern of co-opting a few of his more powerful opponents while criminalizing the rest became a hallmark of Suharto's rule.
In order to maintain a veneer of democracy, Suharto made a number of electoral reforms. He stood for election before electoral college votes every five years, beginning in 1973. According to his electoral rules, however, only three parties were allowed to participate in the election: his own Golkar party; the Islamist United Development Party, and the Democratic Party of Indonesia (PDI). All the previously existing political parties were forced to be part of either the PPP and PDI, with public servants under pressure to join the membership of Golkar. In a political compromise with the powerful military, he banned its members from voting in elections, but set aside 100 seats in the electoral college for their representatives. As a result, he won every election in which he stood, in 1978, 1983, 1988, 1993, and 1998.
This authoritarianism became an issue in the 1980s. On 5 May 1980 a group Petition of Fifty demanded greater political freedoms. It was composed of former military men, politicians, academics and students. The Indonesian media suppressed the news and the government placed restrictions on the signatories. After the group's 1984 accusation that Suharto was creating a one-party state, some of its leaders were jailed.
In the same decade, it is believed by many scholars that the Indonesian military split between a nationalist "red and white faction" and an Islamist "green faction." As the 1980s closed, Suharto is said to have been forced to shift his alliances from the former to the latter, leading to the rise of Jusuf Habibie in the 1990s.
After the 1990s brought end of the Cold War, Western concern over communism waned, and Suharto's human rights record came under greater international scrutiny. In 1991, the murder of East Timorese civilians in a Dili cemetery, also known as the "Santa Cruz Massacre", caused American attention to focus on its military relations with the Suharto regime and the question of Indonesia's occupation of East Timor. In 1992, this attention resulted in the Congress of the United States passing limitations on IMET assistance to the Indonesian military, over the objections of President George H.W. Bush. In 1993, under President Bill Clinton, the U.S. delegation to the UN Human Rights Commission helped pass a resolution expressing deep concern over Indonesian human rights violations in East Timor.
In 1996, the Indonesian Democratic Party, a legal party that had been used by the New Order as a benign prop for the New Order’s electoral system, began to assert its independence, under Megawati Sukarnoputri, the daughter of the popular father of the nation, Sukarno. In response, Suharto attempted to foster a split over the leadership of PDI, backing a co-opted faction loyal to deputy speaker of Parliament Suryadi against supporters of "Mega".
After the Suryadi faction announced a party congress to sack Megawati would be held in Medan 20â€"22 June, Megawati proclaimed that her supporters would hold demonstrations in protest. The Suryadi faction went through with its sacking of Megawati, and the demonstrations manifested themselves throughout Indonesia. This led to several confrontations on the streets between protesters and security forces, and recriminations over the violence. The protests culminated in the military allowing Megawati's supporters to take over PDI headquarters in Jakarta, with a pledge of no further demonstrations.
Suharto allowed the occupation of PDI headquarters to go on for almost a month, as attentions were also on Jakarta due to a set of high-profile ASEAN meetings scheduled to take place there. Capitalizing on this, Megawati supporters organized "democracy forums" with several speakers at the site. On 26 July, officers of the military, Suryadi, and Suharto openly aired their disgust with the forums.
On 27 July, police, soldiers, and persons claiming to be Suryadi supporters stormed the headquarters. Several Megawati supporters were killed, and over two-hundred were arrested and tried under the Anti-Subversion and Hate-spreading laws. The day would become known as "Black Saturday" and mark the beginning of a renewed crackdown by the New Order government against supporters of democracy, now called the "Reformasi" or Reformation.
The political tensions in Jakarta were accompanied by anti-Chinese riots in Situbondo, Tasikmalaya, Banjarmasin (1997), and Makassar (1997); while violent ethnic clashes broke-out between the Dayak and Madurese settlers in Central Kalimantan in 1997. After a violent campaign season, Golkar won the rigged May 1997 MPR elections. The new MPR voted unanimously to re-elect Suharto to another five-year term in office on March 1998, upon which he appointed his protxgx BJ Habibie as vice-president while stacking the cabinet with his own family and business associates (his daughter Tutut became Minister of Social Affairs). The Government's increase of fuel prices by 70% in May triggered rioting in Medan. With Suharto increasingly seen as the source of the country's mounting economic and political crises, prominent political figures, including Muslim politician Amien Rais, spoke out against his presidency, and on January 1998 university students began organising nation-wide demonstrations.
In the 2nd half of 1997, Indonesia became the country hardest hit by the Asian economic crisis. The economy suffered a flight of foreign capital leading to the Rupiah falling from Rp 2,600 per dollar in August 1997 to over Rp 14,800 per dollar by January 1998. Those Indonesian companies with US dollar-denominated borrowings struggled to service these debts with their Rupiah earnings and many went bankrupt. Efforts by Bank Indonesia to defend its managed float regime by selling US dollars had little effect on the currency's decline, but instead drained Indonesia's foreign exchange reserves.
Weaknesses in the Indonesian economy, including high levels of debt, poor financial management systems and crony capitalism, were identified as underlying causes. Volatility in the global financial system and over-liberalisation of international capital markets were also cited. The government responded by floating the currency, requesting International Monetary Fund assistance, closing some banks and postponing major capital projects.
In December 1997, Suharto for the 1st time didn't attend an ASEAN presidents' summit, which was later revealed to be due to a minor stroke, creating speculation about his health and immediate future of his presidency. In mid December as the crisis swept through Indonesia and an estimated $150 bn of capital was being withdrawn from the country, he appeared at a press conference to assure he was in charge and to urge people to trust the government and the collapsing Rupiah.
Suharto's attempts to re-instill confidence, such as ordering generals to personally reassure shoppers at markets and an "I Love the Rupiah" campaign, had little effect. Evidence suggested that Suharto's family and associates were being spared the toughest requirements of the IMF reform process, and there was open conflict between economic technocrats implementing IMF plans and Suharto-related vested interests, further undermining confidence in the economy. The government's unrealistic 1998 budget and Suharto's announcement of Habibie as the next vice president both caused further currency instability. Suharto reluctantly agreed to a wider reaching IMF package of structural reforms in January 1998 in exchange for $43 billion in liquidity. However, the Rupiah dropped to a 6th of its pre-crisis value, and rumours and panic led to a run on stores and pushed up prices.
In January 1998, the government was forced to provide emergency liquidity assistance, issue blanket guarantees for bank deposits, and set-up the Indonesian Bank Restructuring Agency to take over management of troubled banks in order to prevent the collapse of the financial system. Based on IMF recommendations, the government increased interest rates to 70% pa on February 1998 to control high inflation caused by the higher prices of imports. However, this action restricted the availability of credit to the corporate sector.
Suharto's position as president had remained solid for 30 years so long as the Indonesia economy grew strongly. When the economic crisis hit in 1997/98, Suharto's performance legitimacy disappeared and once strong support for Suharto disappeared both domestically and internationally.
As the financial crisis unfolded, opposition leaders such as Amien Rais became more vocal in their criticism of Suharto and the New Order. There were rumours of splits in the armed forces, imminent riots and talk of a bloody crackdown.
In 1997 and 1998 there were riots in various parts of Indonesia. Sometimes these riots were aimed against the Chinese-Indonesians. Some riots looked spontaneous and some looked as if they had been planned. One theory was that pro-Suharto generals were trying to weaken the forces of democracy by increasing the divisions between the orthodox and the non-orthodox Muslims, between the Muslims and the Christians and between the Chinese and the non-Chinese. Another theory was that certain generals were trying to topple Suharto.
At the start of May 1998, students were holding peaceful demonstrations on university campuses across the country. They were protesting against massive price rises for fuel and energy, and they were demanding that President Suharto should step down.
On 13 and 14 May rioting across Jakarta destroyed many commercial centres in Jakarta and over 1,000 died. Ethnic Chinese were targeted. The riots were allegedly instigated by Indonesian military members who were out of uniform. Homes were attacked and women were raped by gangs of men who wore ordinary clothing. The US State Department and many human rights groups have strongly argued that the Indonesian military and police participated and incited the rioting and violence against Sino-Indonesians.
Over 1,000 and as many as 5,000 people died during these riots in Jakarta and other cities such as Surakarta. Many victims died in burning malls and supermarkets but some were shot or beaten to death. A government minister reported the damage or destruction of 2,479 shop-houses, 1,026 ordinary houses, 1,604 shops, 383 private offices, 65 bank offices, 45 workshops, 40 shopping malls, 13 markets, and 12 hotels.
A security officer alleged that Kopassus officers had ordered the burning down of a bank; a taxi driver reported hearing a man in a military helicopter encouraging people on the ground to carry out looting; shop-owners at a Plaza claimed that, before the riots, military officers tried to extract protection money; a teenager claimed he and thousands of others had been trained as protesters; a street child alleged that Kopassus officers ordered him and his friends to become rioters; there was a report of soldiers being dressed up as students and then taking part in rioting; eyewitnesses spoke of muscular men with short haircuts arriving in military-style trucks and directing attacks on Chinese homes and businesses.
In May 1998, thousands of Indonesian citizens were murdered and raped... x The Joint Fact Finding Team established to inquire into the 1998 massacres found that there were serious and systematic human rights violations throughout Jakarta. The Team also found that rioters were encouraged by the absence of security forces, and that the military had played a role in the violence. The Team identified particular officials who should be held to account.x The Special Rapporteur on violence against women... also pointed to evidence suggesting that the riots had been organized.
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