Commentary | 19 August 2016

Jokowi now Stronger, but Reform Agenda Narrower than Ever

Originally published in the Australian.

Originally published in the Australian.

Executive Summary

When Joko “Jokowi” Widodo was elected Indonesia’s president in 2014, the first head of state to come from outside the military or political party elite, he promised to do away with the elite dealmaking that had characterised Indonesian politics since the return of democracy in 1998. Political parties would no longer receive Cabinet posts — and the patronage networks that come with them — in exchange for support in the legislature. Ministers, mostly technocrats, would be appointed on merit.

Jokowi’s pledge to do things differently prompted a furious response from several of Indonesia’s party bosses. At the time he was inaugurated in October 2014, the support of his own coalition, and particularly his own party, appeared superficial at best. An opposition coalition threatened to block his legislative agenda and investigate his appointees. On the day he was sworn in, there were even whispers about impeachment.

Nearly two years later, much of that is a distant memory. Jokowi has gradually reinforced his position, culminating in an extensive reshuffle of his Cabinet last month. But instead of changing the game, as he promised voters, Jokowi has begun to master it.

Though he lacks control of any of Indonesia’s ten major political parties, Jokowi has skilfully used the patronage of his office to win support for his administration and key initiatives from party leaders — both from those in his own Indonesia Hebat coalition, and from those outside it.

Last month, he appointed to his Cabinet members of two political parties that had recently pledged to support his administration, dismissing two reformers in the process. Of what was once a five-party opposition coalition, three have now announced support for Jokowi.

Moreover, the reshuffle suggests that, even as Jokowi’s coalition grows, he is determined to lead a disciplined administration — dismissing three ministers who had publicly squabbled with each other and the president over key projects in the energy and transportation sectors — and is newly confident in his ability to manage its byzantine elite politics. Most striking in this regard was Jokowi’s decision to transfer Gen. (Ret.) Luhut Panjaitan, until the reshuffle Jokowi’s top national security minister, and now the archipelago’s coordinating minister for maritime affairs.

Jokowi has known Luhut longer than anyone else in national politics; the two have been business partners for a decade, and Luhut sponsored Jokowi’s unprecedented rise from provincial mayor to president in under three years. In government, Luhut had become the most powerful figure around Jokowi, as Jokowi’s partner in consolidating his political position and the leader of efforts on a vast policy agenda, much of it far outside his official brief. Jakartans observed with arched eyebrows that he had become a kind of “prime minister”.

In his new role as coordinating minister for maritime affairs, Luhut has been given formal responsibility for Jokowi’s top priority, a $455 billion program of desperately needed infrastructure development. But Jokowi’s decision to move Luhut without consulting him, from an office that he had long coveted and only briefly held, to a newer, less prestigious post, sends an unmistakable message that Jokowi, and no one else, is in control. As Indonesians say, a ship cannot have two captains.

What of Jokowi’s vision of a technocratic administration, untainted by dealmaking? The reshuffle suggests that when it comes to policy, Jokowi is less interested in ‘reform’ writ large than in delivering on a narrow program of priority reforms — namely the infrastructure development agenda that he believes will jump-start the economy, lead to long-term growth, and ensure his re-election.

Where good governance measures have been key to the accomplishment of that agenda, he has backed them strongly. But where he considers them peripheral, his support has been episodic or lukewarm. Take, for example, the two most prominent changes to the ministry last month: the return of Sri Mulyani Indrawati as minister of finance, and of Gen. (Ret.) Wiranto as the top national security minister.

Few have fought harder to rationalise economic policymaking in Indonesia than Sri Mulyani, who as a minister under Jokowi’s predecessor shepherded the country through the global financial crisis, increased tax revenues and foreign investment, tackled graft in the tax office, and earned enemies in the Cabinet by refusing to accede to rent-seeking demands.

Sri Mulyani’s return comes just as Indonesia prepares to implement a critical tax amnesty program, designed to entice wealthy Indonesians who have stashed money offshore to declare it and bring much of it back to Indonesia. Though there is reason to doubt his approach, Jokowi hopes the additional revenue will help fund his infrastructure agenda, and that the uncompromising Sri Mulyani can deliver it.

The return of Wiranto, by contrast, is indicative of Jokowi’s more limited interest in foreign affairs, defence and human rights. Wiranto, now a leader of a small party that was an early supporter of Jokowi, was commander of Indonesia’s armed forces during the tumultuous democratic transition and withdrawal from East Timor, where he stands accused of crimes against humanity.

As a result, he has been considered ineligible for a visa to the United States, with whom he would normally be expected to work closely. It also makes him an unlikely individual to lead a process examining a history of massacres in 1965 and 1966, that Indonesia was just beginning to come to terms with under the protection of his predecessor, Luhut.

Sources close to the presidential palace say that Jokowi was unaware of Wiranto’s difficulties obtaining a visa prior to appointing him. Jokowi’s lack of familiarity with foreign affairs, and lack of trusted advisors on the subject, thus remains a major handicap.

The president’s willingness to make deals with party leaders with questionable records has deeply disappointed the activists who supported his extraordinary run for the presidency against a former general with similar problems.

Yet Jokowi, whose broader popularity is at a high, remains narrowly focused on his development agenda and laying the groundwork for his re-election in 2019. The Jakarta intelligentsia hope that he will then turn his attention to other areas in need of reform, but his record thus far suggests that they will have waited in vain.

Aaron L. Connelly is a research fellow at the Lowy Institute for International Affairs in Sydney, where he focuses on Indonesia, Myanmar, and the US role in Southeast Asia.