Kevin O'Rourke – The absence of violence on the June 7th – and in the three-week campaign period leading up to it – has been viewed as a major positive signal for the country's outlook. The stock market has rallied, the currency has soared, and interest rates have plummeted. Within the past two weeks a remarkable wave of optimism has swept through Jakarta: there is a distinct feeling that an end to the political turmoil that has deepened the recession might at last be at hand.
However, such optimism may be premature. Indonesia needs more than a mere cessation of violence. It needs the June 7th vote to be viewed as legitimate – by village, elite, and international communities alike – and it needs a new president willing and able to carry out a systemic change from crony capitalism to a well-regulated market economy. Neither of these two crucial conditions may be forthcoming.
Several international monitoring organizations have confirmed that the June 7th elections were flawed. There are widespread reports of irregularities both before and after the polls, and there is ample circumstantial evidence that Golkar manipulated results in outer island provinces, particularly the nine in Eastern Indonesia. Golkar is leading the vote count in eight of these provinces, with vote shares that range from 48% in East Timor to 68% in Southeast Sulawesi. The latter is the province with the highest voter turnout: an incredulously high 99.2%. The remote and underdeveloped regions of Eastern Indonesia are the ideal place for manipulating results.
Within the next several weeks it should become clear whether the elections are widely received as legitimate, but even if they are accepted, there is another problem facing Indonesia's political outlook: June 7th produced no clear victor. Although interim results indicate that Ms. Megawati Soekarnoputri's PDI Perjuangan won a 35% plurality of the June 7th parliamentary elections, this by no means guarantees a win in the far more significant presidential election, which will take place in the People's Consultative Assembly, or MPR, in October.
Megawati's chances for the presidency at this stage are more remote than is commonly accepted. To reach the presidency, she must vie with two main sources of opposition. As Indonesia's premier reformist, she represents an implicit threat to entrenched establishment interests, such as conservative elements of the military and Golkar. Meanwhile, as Indonesia's leading secular-nationalist, she is opposed by influential Islamic leaders who fear being disenfranchised yet again, as they were under Presidents Sukarno and Suharto. Indonesia's political contest is as much about reform versus the status quo as it is about Islamicism versus secularism. Megawati's problem is that her contest on both fronts is far from over.
The reason is that Indonesia's electoral system heavily over-represents the "outer islands" beyond Java. Although Java accounts for 58% of Indonesia's population, it has only a 50% share of the 462 elected parliamentary seats, with the balance representing the outer islands. This imbalance is accentuated in the MPR. All 462 elected parliamentarians also sit in the MPR, but they are accompanied by appointed representatives: 38 from the military, 65 from "functional groups", and 135 from regional representatives (five from each of the 27 provinces).
These regional representatives could swing the balance of MPR seats in Golkar's favor: only six provinces are on Java and Bali, where Megawati has fared best. Although Golkar only one 22% of the popular vote on June 7th, it will have a higher share of the parliament's seats, and a still higher share of the crucial MPR seats. In the presidential vote, Megawati might be able to count on support from Gus Dur's National Awakening Party (which won 12% of the June 7th vote), but Golkar could ally with the eight parties in the Islamic Alliance (which won 15%, and will pool their votes). The contest is shaping up to be a very close race.
However, there are a number of proactive steps Megawati could take to boost her prospects. In the MPR, delegates will be able to vote across party lines, and every major party is split by internal cleavages over whom to support for president. Megawati can and must entice elements from other parties to join her alliance. For instance, she can make overtures to reformist members of Golkar who are disgruntled with B. J. Habibie, and she can make concessions (such as key portfolios in a Megawati cabinet), to conservative Muslims opposed to her secularist principles. Striking deals with Golkar would disappoint her ardent reformist followers, and compromising with Islamicists would offend her deeply-loyal non-Muslim constituency. However, Megawati must realize that her supporters will have nowhere else to turn for access to power; these are the types of cold political calculations that Megawati must now make to win the presidency.
One area in which Megawati has been consistently proactive has been in courting the military. This she must continue. A chief concern of the military (and especially its commander, Wiranto) is to protect the vested interests of its generals. This includes both active and retired officers – most importantly, ex-President Soeharto. There are signs that Megawati has promised Wiranto that she would treat Soeharto with leniency, and indeed, many observers take it for granted that the military will ultimately support Megawati. However, her promises may not be sufficient to win their allegiance. The military might feel more comfortable with a compromise candidate – particularly one whose supporters are not clamoring for Soeharto's prosecution.
This conjures up a host of other possible outcomes for the MPR. One is that the military supports the incumbent president, B. J. Habibie, in a partnership with Golkar and Islamic parties (with whom Habibie enjoys quite strong ties). However, many within Golkar are stridently opposed to Habibie. More importantly, the military and Golkar must realize that an MPR victory for Habibie would once again bring thousands of angry students onto Jakarta's streets – and perhaps throughout the cities Java. Therefore an anti-Megawati alliance would be better served to look for a compromise candidate. Wiranto himself had been a strong contender, but his political fortunes appear to be fading. Military abuses continue, and the situation is deteriorating in Aceh – a province which many Islamicists view as a symbol of their struggle. Wiranto shares Habibie's major weakness: strong ties to Soeharto.
Given these considerations, Indonesia's new front-runner in the presidential race is probably the Sultan of Yogyakarta, Hamengkubuwono X, who occupies a strategic position at present. As a former (albeit reticent) Golkar official, he is readily acceptable to many within the ruling party. Meanwhile, as one of the first nationally-recognized figures to publicly break with Soeharto, the sultan won a reformist reputation that he has since kept up. Finally, as Java's main sultan, he is strongly supported by Gus Dur's National Awakening Party, which largely represents traditional Javanese Muslims. He may even succeed in attracting grudging support from modernist Islamic parties. The sultan is not popular in the outer islands, where is viewed as a symbol of Java's historic hegemony over the archipelago, but this is compensated for by the fact that Golkar has won much of the outer island vote. Unfortunately, if the sultan can only be brought to power with the assistance of Golkar and Wiranto, Indonesia's process of reformation would probably fall short of what Megawati could achieve as president. As president, the sultan could help restore social and political stability, which would in turn boost the chances for a resumption of economic growth. However, it remains to be seen whether a compromise candidate such as the sultan would be able to carry out the profound systemic transformation that Indonesia desperately requires to put an economic recovery on sustainable footing: namely, a change from crony capitalism to a properly-regulated market economy.
[Kevin O'Rourke is the managing editor of the Van Zorge Report on Indonesia.]