Corruption in Indonesia: A Curable Cancer?

"Corruption in our country is not the result of corrupt minds but of economic pressures. Eventually, when economic development has gone so far as to produce a good overall standard of living, government employees will receive adequate salaries and have no reason to practice corruption. [But] no corrupt act, even under the pretext of helping people, can be justified. " --former Indonesian President Soeharto(1) Few modern leaders have embodied Louis XIV's statement that "L'etat, c'est moi" as completely as former President Soeharto of Indonesia. One of the prime manifestations of his dominance was his blatant disregard for international norms and the extent of corruption he sanctioned. Contending that corruption was merely a matter of small bribes, kickbacks, gratuities and petty theft by underpaid, low-level government employees, Soeharto disregarded practices such as the millions of dollars in under-the-table payments made by companies to senior government officials to win major government contracts. In his view, the rules of the political game permitted him, and his aides, to bestow an assortment of benefits on crony businessmen, family members and loyal officials. These ranged from lucrative distribution and supply deals with state-owned companies, financing from state banks, preferential consideration on government-funded infrastructure projects and export/import monopolies. It is little wonder that under Soeharto's leadership Indonesia acquired a reputation as one of the most corrupt countries on earth. Transparency International's corruption index recently ranked it the third most corrupt country in the world, behind Cameroon and Nigeria. (2) What may be worse is the perception both inside and outside the country that corruption worsened during the 1990s. Hardly a week passes without new press reports of corruption or judicial proceedings that reveal illegal payments. Worrisome as well is the perception that the incidence of corruption on a grand scale has increased exponentially. The most dramatic instance of this can be found in the pages of Time Magazine, which pegged the accumulated assets of President Soeharto and his family at US$ 15 billion in mid- 1998. (3) Time Magazine's report argued that two factors pushed Indonesia into "a league of its own" as far as corruption was concerned. First was the cascade of funds pouring into business and real estate, with the World Bank estimating that Indonesia received more than US$130 billion in foreign investment from 1988 through 1996. Second was the impact of all six of the President's children becoming major players in business in Indonesia. An estimated US$73 billion passed through the family's hands between 1966 and 1998. It seemed self-evident to many within Indonesia that such wealth could not have been accumulated legally, particularly in light of the fact that several of the large business empires owned and run by the presidential family had been built in less than a decade. Corruption, collusion and nepotism (korupsi, kolusi, dan nepoisme or KKN) became the rallying cry of the Reformasi forces that proved instrumental in the fall of President Soeharto in May 1998. The failure of his successor, President B.J. Habibie, to put his mentor on trial for corruption and to resolve several other high profile cases of alleged corruption, along with the crisis in East Timor, were decisive factors in the rejection of Habibie's re-election bid by the supreme People's Consultative Assembly (MPR) in October 1999. Instead, the MPR elected two leaders widely perceived as KKN-free: Abdurrahman Wahid as President and Megawati Soekarnoputri, daughter of independence leader and Indonesia's first president, Soekarno, as Vice President. Within their first month in office, Wahid and Megawati began implementing a new corruption law and reopened the investigation into Soeharto's wealth that had been closed by Habibie's government shortly before Habibie left office. …