Jakarta's budget for 2001 was based on a ratio of 7,800 rupiahs to the dollar. As the currency devalues, so does the government's ability to pay its teachers, postal workers and other state workers. It is rumored that the government will be too broke to pay its civil servants as of November 2001. This would only add force to a building social backlash. A Nervous Region and a Strained Military Indonesian student-protestors wave rupiah notes during a mass demonstration in front of the presidential palace in Jakarta on March 12, 2001.
Regional governments are clearly nervous at the events shaping up in Indonesia.
The governments of Malaysia and Singapore have offered advice for stabilizing the situation, going so far as to advocate a return to a semi-autocratic rule. For Australia's part, recent reports suggest Canberra has withheld information on Indonesia's military abuses - likely an effort to swiftly rebuild international ties to the military on the perception that it is the one force capable of binding the nation together. In fact, there are signs that the military is preparing to reassert its influence after two years in exile and shakeups by the Wahid government. A closed-door meeting in March brought together 95 senior army officers, who apparently discussed the military's waning ability to deal with the political and social instability in Indonesia. Less than two weeks after the meeting, the Indonesian government officially declared the Free Aceh Movement a separatist group, giving the army greater leeway in dealing with Aceh's problems.