Kwik Kian Gie

Since Suharto ‘s hold over the country, economists associated with such an unnamed organization so called as “Berkeley Mafia” (BM) has taken control the country’s economy up to now, excepting short period of time of KH Abrurrahman “Gus Dur” Wahid’s administration.

During Gus Dur era, the impact of BM has not been as absolutely as previous power. Through the National Economy Council led by Prof. Emil Salim and Dr. Sri Mulyani Indrawati as secretary, it remained poerful in restraining the national economy. Then the following body set up that called as Assistant Team of Coordinating Minister for Economy and Finance, led by Prof. Widjojo Nitisastro and Sri Mulyani as secretary.

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So, in the period of Abdurrahman Wahid, all of the economic teams outside of BM circle were haunted by BM that has closely relationship to the international loan providing countries and institutions to Indonesia.

Members of BM were not always the graduates of Berkeley University at California. Many Berkeley’s graduates have not involved in BM. On the contrary, many graduates from other universities have involved themselves in BM.

During President Soekarno’s Old Order, national economic development had no adequately attention. Sukarno and his followers were faced by a large number of Indonesian with various tribes and cultural backgrounds.

In this era, I would like to call it as the Nation and Character Building era. Foreign loan amounted to  $2 billions. Natural resources practically remained excessive, even though without any economic development, the prosperous and prosperity of Indonesians remained backward. In the end of Soekarno's administration, the inflation raised amounted to 600% and the political situation was not stable as a result of the resistance of Indonesian Communist Party that so called as 30 September Movement. 

Why was the economic issue “neglected”? Is it right that Soekarno did not understand economy and had no any concern dealing with economic development?

Why Bung Karno did not invite foreign capital excessively and attracted foreign experts to restrain Indonesia through binding advises and recommendation? 

In accordance with Bung Karno’s speech, it was clear that he did know about the importance of economic development. But there were two factors differentiating between Bung Karno and MB. First, he had a heavy duty to make Indonesia to be a nation bound to Tunggal Eka within its diversity. He needed to spend a lot of time, even though the economic development could not be handled ideally for a heavy duty in integrating the nation, that has ever been disturbed by liberation movements such as Darul Islam/Indonesian Islamic Army (DI/TII), RMS, PRRI/Permesta, and other geo-political gnawings. Second, Bung Karno was a real nationalist in a positive sense. 

Respecting a question why did Bung Karno have such a "reserve" to the foreign capital, Ibu megawati ever told me. State Palace was always inundated by foreign investors, asking Bung Karno to be able to explore and exploit oil and other natural resources. Bung Karno always rejected them excepting in the minimum scale of oil reserves just to fulfill the urgent needs. Ibu Mega (16 years old at that time) asked her father, why do you reject?

Bung Karno answered: “Be calm dis, we will wait for our own country’s engineers.” So, Bung Karno was not be opposed to the West. Instead, he expected to explore and exploit the country’s natural resources together with Indonesian engineers, especially those who graduated from ITB (Bandung Institute of Technology). Again he was not opposed to the West. He really loved his country without any effort, inflicting a loss upon others. Bung Karno yearned Indonesian oil companies such as Shell, ExxonMobil, Chevron, Total, and so on.

Now we have so many mining engineers with ideally academic degree, PhD For instance, from the Western prestigious universities from European and the United States. Yet about 92% of our oil reserves have been exploited by the foreign companies. Pertamina has just exploited about 8%. In accondance with the contract, 85% is for Indonsian and 15% is for the foreign companies. But in fact 40% is for foreign companies and 60% is for Indonesian. 

Why the foreign companies have not received 15% in accordance to the deal? It has been caused by such requirements, say that all costs of exploration should first of all paid without any left burden. The raising question that always comes to my mind is that why up to now our beloved country has not paid its foreign debt yet to th