Fare well 2009, may you be better than 2008

Anybody who has been reading up on next year's forecasts- issued by the members of the commentariat- is unlikely to feel optimistic about 2009. A recent Rabobank forecast, for example, believes that the UK economy will shrink by 1.5 % and that unemployment will reach as high as 8.5 % (at the time this newspaper went to press, it is not certain whether the predicted unemployed include Gordon Brown).



The Indonesians amongst us old enough to remember the infamous Krismon surely now have that sinking feel of how familiar all of this is. However - there are probably lesser number of Indonesians now who remain optimistic that somehow, all of the doomsday scenario will come to naught.



Of course there is some basis for being a tad optimistic about the situation. In a survey by The Economist issued for the 10th anniversary of the Asian Economic Crisis in June of this year, it is quite robust in the assessments that our banks are stronger than before; that our foreign reserves are more plentiful ; and that our economy is not as reliant on foreign investment as before. In addition - in the words of a former ambassador of the court of St. James's to Indonesia - "Indonesia is a dissappointing country; it dissappoints the pessimists, but it also dissappoints the optimists".



For all our sake, may Indonesia be a very dissappointing country in 2009.

A View to A Kill

If the world is remotely like " Quantum of Solace", then Ford would not be reporting a loss in their latest quarterly report. In such a world, every secret agent drives an Aston Martin, every police force employs a Land Rover and every sinister character prefers the rugged Range Rover as the Bad Mobile.

Such is the power of product placement these days that your correspondent fails to find the Bond-ness of "Quantum". Afterall, none of the old formula remains. Gone are Q, Moneypenny and even the trusted "Bond, James Bond" routine. The ol' boy is no longer the last bastion of the upper class. He goes mass market by driving the - no surprise - Ford Focus and Ford Fiesta.

If this were not a 007 movie , would your correspondent even bothered? The sad answer is : probably not. Take out the franchise and what we have is pure and simple an action movie. And not a good one at that. The story are nowhere as good as Bourne trilogy for example (come to think of it, does the scene of our MI6 man chasing agent Mitchell over rooftops remind you of a similar scene in the last Bourne movie?).

If the direction continues like this, it is likely the License to Thrill need to be revoked. The franchise need to say No but with sufficient verbal dexterity to learn Never Say Never in coping with commercial pressures. After all, The World is Not Enough for too many changes On Her Majesty's Secret Service. One view of this movie is enough to kill the franchise.

Perhaps to make the point, the original 007 , Sean Connery makes an appearance as the Louis Vitton advert in the same week that "Quantum" makes its debut. Coincidence? I expect you to think, 007.

Yes, He Did

In the annals of The Economist, "The World in 2008" would not feature high in the powers of prediction. In the publication - published towards the end of last year- it strongly predicted that next president of the United States would be .. Senator Hillary Clinton.
President-elect Obama's victory has been received - rightly - with plenty of good will. Kenya declared a day of national holiday. Your correspondent just happens to believe the RI government can now feel proud to have one of its former students become "the leader of the free world" (and Hardiknas now have a living mascot).
It will really be interesting to observe the next days ahead. Some will know that one of the names being considered for the White House Chief of Staff is Rep. Rahm Emmanuel. Incidentally - for some of us who are political hacks, and we do exist- he is the model for the character of "Josh Lyman" in the NBC series "The West Wing". It is widely believed that the White House chief of staff is the 2nd most powerful job. It is tasked with giving recommendations for the President and in charge to ensure the cabinet toes the party line.
Other key appointments will be Treasury. Arguably this is one of the rarer moments of history whereby the post is probably more important than State.
As Indonesians, we should observe the extremly gracious concession speech as a model for our own 2009 election.

And the Winner is ...

Car? What Car?

Fully accessorized car....

Till Debt Do Us Part

The last time the words "crisis", "cabinet reshuffle", "drastic depreciation" were deployed in Indonesian politics, a president fell from grace. Ten years and four presidents later, my fellow correspondents might be waiting with glee for a chance to employ these in their lexicons again.
But this article is not about that rumour of a senior minister plotting to deport another senior minister (whose welfare not as equal). It is however about the current crisis , once thought only will engulf the U.S. Of A but not WOUSA (world outside the USA). In particular, this crisis is about whether indeed in our case, capitalism is at bay.
Unless you have been staying in a deserted island since early October, you would have heard whispers of pure poison about the rise and fall of capitalism and that the time of socialism is upon you. The Economist, that bastion of free market and democratic reform has predictably put a case arguing that infact capitalism should still be the preferred model, because it has been responsible for all the wealth creation that the world has ever seen. It has also argued that speculators , the favourite bad guy making the rounds these days are in fact not responsible at all for this crisis.
So should we in Indonesia flog capitalism at the next market and try our luck with Cooperatives?
Cooperatives in Indonesia - much to its acknowledged "father", co-proclamator Hatta's dismay- never really found the market equilibrium.
Even in the bad old days of the Krismon, we never looked back and continue to worship at the temple of capitalism...

Back to the Future

One more way to reduce pollution ...

Great Expectations

Jakarta, on one of the more beautiful days. My dearest wish is that this picture does not create such high expectations, bound to dissappoint would-be visitors ...

A change in the climate ?

Will the recent global market rout mean less money for the climate change fighting efforts ? At least this question was felt to be important enough that Messr. Sarkozy felt needed to be laid to rest at Thursday's announcement in Brussels.

The impact of the rout should not be understated. A recent special report suggested that a staggering USD 10 trillion of value could be wiped out between now and 2009. For comparison, this is 10 % of the annual US ' Gross Domestic Product.

There is a temptation to focus on wealth maintenance rather than health maintenance. Indeed your correspondent felt compelled to understand the answer to this question.

Though Mr. Sarkozy have confirmed that the funds earmarked to save the laissez fare economy will not result in less fund available to fight climate change, the details have not been immediately available. It is difficult though to comprehend that there won't be an impact. By now, the US have added USD 700 billion to their USD 435 trillion budget deficit, all in the name of saving the US economy. The UK have confirmed that it will spend GBP 250 billion to nationalize household names such as Lloyd's TSB and HBOS. The EU - old and new - does not want to be left behind and have pledged EUR 350 billion, also to nationalise troubled banks.

Our dear government meanwhile have indeed taken some steps. However at the time this newspaper went to press, there has been no discussion with regards to if less funds will be made available to fend off climate change. Upon closer inspection however - given the very low number of projects planned-the impact appreared to be unsurprisingly negligible.

The crux of the activities have not been expected to be funded or coming by the government. They have been expected to be a result of a change in the behaviour of each and every individual's. Plenty of these also did not require investment.

Therefore please continue to
* B2W (less pollution)
* Switch off the lights when you leave the room (less coal being burnt)
* Convert those energy guzzler light bulbs (ditto)
* Be as paperless at work as possible (be a tree hugger)
* Continue to print on used paper
* Don't send unnecessarily large attachments with your email (less use of your bandwidth, therefore less energy consumed)
* Design those houses who are easy on the sunlights
* Set those aircons on timers

Keep those ideas flowing in ...

The Week From Hell

A week is a long time in politics, but apparently it was even longer in world finance. This was the week that your correspondent had planned to be a week filled with leisurely walk with the missus and the kids at malls, trialing that new oma fiets recently bought and perhaps even a sip or two of the nouvoeu vines bought recently. Alas that did not exactly happen.

As would become rather obvious by now, instead the week was spent glued to the telly and or surfing that bastion of western newsmedia, CNN.com. The last time your correspondent formed such attachments to the twin tubes of tv and internet was during the September 11 attacks. Though the causes are markedly different, the sinking feeling is oddly similar.

To make things worse, there does not seem to be light at the end of the tunnel. The worrying thing is that this crisis seems to have a life of its own. The oft-cited "the index has hit its lowest level since somany years" well hit a new low the day after. Why buy now when you can buy it cheaper tomorrow?

Such is the life of the monster though that the governments seemed powerlesss to put a stop to it. It is also frustrating to see that the governments have even gone to the extend of nationalizing insurance companies, investment banks and building society. At least this has not been the tactic chosen by our dear president and let's hope he is not tempted. Governments across the world don't have a good track record of running insurance companies for example. Is this the time for them to dabble their hands into the companies ?

Friends I spoke to have advised to keep our seatbelts on. Most seemed to agree that though this situation maybe a holding pattern, the ground is not visible yet. A thick fog of uncertainty and panic is blanketing the situation and the best thing to do may well be not to make any rush decisions. Alas the irrational exuberance of panic investors may well be the fitting match to the same irrational exuberance which started this giddying crisis in the first place.

Laugh at First Sight

If your insurance company have just received USD 85 billion from the government, and in return, the government nationalized your company, what is the first thing you would do? Well -naturally - you would take your best sales reps to a resort, celebrate what a good year it has been so far and spend the better part of USD 400, 000।

That , at any rate, was apparently what American Insurance Group (AIG), an insurance company, was doing around last week. At this point let me declare a potential conflict of interest : I own an AIA Life Insurance policy, so I do have an interest in seeing the company is still around when my policy expires.

I am guessing there were plenty of glee around the table of business ethics wonks when news of this sales conference spread. They have a new set of ammunition when this morning it was reported AIG would receive an additional USD 35 billion. It is this correspondent's feverish hope that AIG would not be tempted to splash it on another junket trip (not even on a smaller resort, just because the new funds is less than the first injection).

Given the barrage of less than good news , it is quite likely that the AIG sales reps in the holiday resort will be joined by central bankers , ex employees of Lehman Brothers and the common people like you and me (though by this time - with all these people - the resort should be rather full)।

This turn of events is a big pity for the development of the insurance market for Indonesia. There are plenty of my fellow citizens who must be wishing they bought more handbags than insurance policies. But the reality is more and more people were gambling their future on insurance.

I remember a close friend of mine who is working on the sideline as an insurance agent. He laughed outloud when he knew how small my policy was. He immediately offered me a policy which would have meant I need to pay Rp. 3.5 million per month. Strangely enough I have never heard from him again since the last time we spoke , which was ,er, just before the crisis begin

I don't think he is still laughing at me now. But I also am not laughing either. On paper , I am not sure what is the return on my stock market-linked policy. But at least my portfolio is not all in insurance.

For all our sakes, this downturn had better be not too severe and not too long. However as we know we did not get to where we are overnight. Getting out won't be an overnight trip either, though spending it in a resort might ease the pain.

Nightmare on our Street

Within days of your correspondent's "House of Cards" feature being published in this newspaper, a number of Indonesian cabinet ministers and renowned economists began to fret about the same topic : what is the impact of the US Economic Crisis on our own economy. Though on one hand it is gratifying to note other, more established experts have the same train of thought, on the other hand, it is unnerving to read on their comments and feels a lack of confidence in the preparation level.

We do not have the time to go through the usual motion resulting in the nation back to square one after, say, 3 months. All the usual players, legislators, policymakers and the commentariat ranks need to start from the same page. The stakes are frankly too high to continue play politics as usual. If there is a time to play as a team, this is it. Where is the Lembaga Penjamin? Where is the DPP Real Estate Indonesia ?

The reality is though that with the elections around the corner, there is a possibility that , in fact, it will be politics as usual. The MPs will play safe and not taking any risks with a potentially budget busting policies. The central bank and the financial institutions are probably reluctant to support any monetary expansion by a (potentially) lameduck administration.

Short of suggesting all the stakeholders is in need of changes of their living organ inside of their cranial, it does not appear there is much that can be done overnight.

So what is there that can be done ? This newspaper has a few suggestions :
1)The central bank to impose a new policy disincentivising the banking industry to extend loans to the people who can not have a mortgage. This newspaper does not have access to the extent to which mortgage accounts for banking loans but it may be quite significant.

2)The central bank to increase the industry's capital adequacy ratio (CAR) for a definite period of time. This additional breathing space can be used for the central bank either to nudge banks to conduct self audit or if forced to externally audit the suspected banks.

3)Commission a quick study to get a feel of the interconnectedness between the local portfolio and those of the now infamous CDs and all the other exotic acronyms spewn by the U.S.

It is your correspondent's fervent hope and wishes that our country and tax payers like you and me do not need to bear the burden of a bailout to help the fat cats who were grossly overpaid and grossly incompetent.

Selamat Lebaran

Your correspondent would like to wish the readers a Selamat Lebaran. May your lives become more meaningful, may you found your trueself and may you always be protected under the auspices of the creator.

House of Cards

For the first time in a long, long, time , President Bush will have quite a few people to agree with him. Quite. I am of course referring to last night's congressional rejection of the USD 700 bn package. He had said that rejection is a doomsday scenario. At this moment, not too many writings have been devoted to the (potential) side effect to our economy, so allow me to sketch a few broadbrush ideas.

It is commonly known that despite talk of a "decoupling", the fact of the matter is that Asian economies are growing less than predicted. There is therefore a strong base to believe that our economy will be quite affected by this latest development.

Our exports to the U.S. would most likely be slowing down , impacting our trade balance. Remember that as late as August of this year, our own president had tabled a budget of Rp. 1,000 trillion. This reduction in export receipts will impact the government's spending plans, of which the main feature was the already earmarked 20 % for education. This maybe one of the first to be impacted.

Speaking about budget, it is useful to speak about the middle class' budget. Jakartans will notice the web of sky rise office buildings and apartments currently blanketing Jakarta's skies. As the economy slows down, money becomes scarce and banks , real estate companies are relying ever more on the monthly mortgage payments. So long as the people still have jobs, this is not an issue. However the moment unemployment picks up, the probability of failure to keep up with the mortgage payment becomes higher. Assuming the houses/apartments were reposessed and offload into the market, such act will depress the property markt and may result in a negative valuation for the remaining owners. Banks become even more depressed, funds to invest or to cover liabilities become even scarcer. Overnight rates shot up, the central bank might have to step in. Sound familiar so far ?

The major difference (I think) between our economy and those of Uncle Sam's is that our mortgage market aren't as influential. Quite a few couples still live with their parents. Irrational exuberance did not have too many card-carrying members. The other - potentially more lethal- difference is quite a few property investments are speculative in nature. Either it is not being occupied or it is leased. The jury is still out on the strength of the buy-to-lease market but employment of young professionals would be a key factor.

As can be ascertained , thus far, the silver lining has not appeared in the horizon. However, as one former Ambassador of the Court of St. James to the country memorably said, "Indonesia is a country for the optimistic pessimist". This pessimist would more than prefer to be proven wrong.

A Safer Exodus

Frequent readers of this newspaper would recall a recent article supporting the development of the Trans Java highway. Given the expected headlines in the newspapers about the oh so long time it takes to reach one's kampong during the Lebaran period, it seems more daft for the government not to shift construction to the fifth gear.

The case is strengthened by the serial unreliability of the alternative modus of road transport, especially that of the trains. Derailed trains, accidents involving the daredevil passengers sitting on top of the coaches are a common occurence. It is feared that as the train activities pick up, the incidents become more frequent.

Therefore if the government still doubts about the return on their investment of the highway, they should start with a good feeling that by doing so, they have saved the lives of their citizens. Should this not be sufficient, surely a moral bancruptcy has occured.

Return of a more hedonistic nature are obviously still can be expected. If you look at the developed highway system of Europe for example, where your correspondent is mildly acquainted with, hotels, amusement parks, theme parks, petrol stations , all sprang up like mushroom in the wet season. These bring investment which begets employment and tax revenues. These in turn create the multiplier effect in both the national and the local economies. At the same time it encourages entrepreneurs to be more innovative in adjusting to this new phenomenon and compete for customers. So everybody wins, right ?

But the biggest winner will be people like you and me. Our travels will be safer, more relaxing and - hopefully- will spawn an industry of local winnebagos / RVs !

The Rainbow Warriors

This time next week, Jakarta will be able to take a breath of fresh air resulting from a virtual absence of cars, pollution generator buses and Valentino Rossi wannabes motorcyclists. Alas this heavenly period only lasts for one week before the well-travelled permanent visitors headback to the nation's capital.

Anybody who was in Pondok Indah Mall tonight must have been wishing for an early Lebaran. The place was jammed with cars , bumper to bumper. It took as long to leave the underground parking lot as it does to travel from Kebayoran Lama to the mall itself. The heat and pollution underground was unbearable and I felt really sorry for the security team and the parking attendants who were still there and could not escape from the netherworlds.

Of course this being one of Saturday night plays a factor for this additional hot air but I wonder if the other reason is the showing of Laskar Pelangi, based on an acclaimed best seller about the travails of two idealistic teachers and their students in Belitong ("Biliton").

Your correspondent, generally speaking, is not a big fan of local movies. But I am making an exception for this wonderfuly touching movie. The story is well known therefore it is not repeated here.

All sorts of emotions came up. Childhood memories, emotional attachment and perhaps even social cohesion.

Childhood memories

Watching the movie brings back your correspondent's childhood memories of the situation around 1979. The products, newspapers, cars, music. Did anybody see the blue Datsun Pick up ?

Emotional attachment

The more emotionally accomplished might feel blessed that despite their problems living in Jakarta, all their whinings are nothing compared to the very basic needs of education that those very brave children in Belitong were fighting for.

It also reminds me of all my teachers from my SD years. I have lost touch of all of my SD friends and I wonder what happened to them. I am now 37 years old so it has been 25 years since the last time I saw them.

Social cohesion

But perhaps the real message of this narrative is further proof of Indonesian diversity and that Indonesians of all background can and should forget their differences and focus on how to make the most of it. The children are malays, chinese; moslem, mysticists and buddhists. And yet , despite the odds stacked against them, they blended into a solid, close and loyal team.

In preparation for the maelstrom of bad economic news from the US and the politics for the parliamentary and presidential elections of next year, this spirit would really come in handy inside each and everyone of us, Indonesians.

Coming to an election near you

The general election is scheduled for 2009 but understandably some parties have begun to buy advertisements. It is these advertisements which have attracted attention to a candidate called Rizal Mallarangeng.

Discussions at wedding parties and dinner table often mention the Rizal phenomenon. It is not widely known how he has been funding one full page full colour ad in the country's largest dailies. Recently however it is noticed that a private tv station displayed its logo in a billboard of Rizal's.

What is also not clear is Dr. Mallarangeng's objectives. He has not come out and say what his plans are, whether it involves running as an independent or jumping into bed with some of the 38 political parties which will be contesting next year's election.

Therefore people like your correspondent is at a loss in understanding his motives. Some people believe that Dr. Malarangeng is a proxy of elements of the Golongan Karya (GOLKAR) political party who wanted to disrupt the progress Mr. Soetrisno Bachir, a one-time client of Dr. Mallarangeng (he created Mr. Bachir's ads and bought airtime to play them. In fact there are large similarities between the themes of Dr. Mallarangeng's ads and Mr. Bachir's).

All this is purely speculation. However indeed the private tv station associating itself with Dr. Mallarangeng is owned by the head of GOLKAR's supervisory board. That , your correspondent believes, started the speculation about GOLKAR aligning itself with Dr. Mallarangeng.

What does all this mean for the voters? Against this background, one must also consider the recent barrage of stories alleging how MPs have been taking facilitation payments. Your correspondent believes all this builds a picture which is not rosy for the political establishment. In essence these stories highlight that all MPs are created equal; ie no matter what parties they belong to, they all took the money when offered.

Arguably this reduces voters' trust in the parties. It can either lead to support for "independent" with no visible political associations , like Dr. Mallarangeng. Or, the second possibility is that the as voters distrust the parties, they decide to boycott the election and not vote at all.

If the second possibility were to be realized, it will be a pity for Indonesian democracy. The right to vote is a precious right and should not be waved on a whim. Granted 'not voting' is also a vote but it should be taken as a last resort.

Have a winnebago ?

The last time I took the Pantura road during the Lebaran "Mudik" period was, well, never, actually. In fact I have always spent my Lebaran at home, be it Jakarta, Kuala Lumpur, Den Haag or Manchester. Any self respecting petrol head would never be seen crawling 1 kph for hours on end as they criss cross Java from one end to another.

Why am I writing about this at all. Ah but in today's KOMPAS, the respected daily appear to argue for a rethink of the Trans Java motorway to be built on 1,200 km of road between Merak and Banyuwangi. By building on its current grote postweg expedition it warns policy makers about making the same mistake that governor general Daendels made when he built that road 200 years ago.

To be brutaly frank this is just about the most daft analysis I read and from Kompas it is even more annoying. Of course the grote postweg did not benefit the people. Did the Kompas reporter remember that Indonesia was ruled by a band of well armed Dutch traders? Hello anybody home?

The piece was directed to policy makers so that they took into considerations such aspects as potential damage to the environment, displacement of people etc. It even interviewed Emil Salim (alas not a relative) who basically cautioned the government to ensure all that is in place.

Ok so it is not all daft in this morning's piece. I completely agree with the observation about potential destructions to rice fields. And I don't understand how an executive plans to "replace" the affected fields with a similar one in another island. Is he talking about transmigration? Ow my gawd ...

Ah but wouldn't it be cool that Trans Java actually becomes a reality ? I have visions of a flotilla of R.V (recreational vehicles) filling up a wide motorway from Jakarta to Surabaya, passing through scenic locations and with plenty of rest areas complete with motels, restaurants (ah obviously need to put up gas stations), swimming pool for the kids ...

Ow this idea is so good I think I won't cancel my lifelong subscription to Kompas despite reading the silly piece ...

But will Trans Java actually be realized? I think the idea has been bandied about for a long time so if it is going to be built, it is about time. If any of you have a spare cash these days (as you do), you might want to quickly grab a strategic land, get talking to a motelier and restaurateur and a fuel marketing company. It may just be an investment which will pay handsomely ...

On Vacation

After working at some weekends since January, traveling in challenging roads to remote places and generally busy, your corrrespondent decided to take 10 days off and chill out.



So what does your correspondent do on vacation? Well not too much this time. So far, your correspondent is becoming a full time taxi driver for the kids, becoming well-versed in trying (focus is on trying) to restore a 1996 C-Class Mercedes Benz and balancing his financial condition.



Before starting off, it should be mentioned that the bbq on Sunday was a good one. Families came along and he thinks he managed to convert a few to succumb to the temptations of wines and cigars :)



The taxi run so far is quite taxing. In the process, he noticed that maybe he needs to wean Stuttgart's finest off the 88R and go back to 92R. Today he was told that the retail price of 92R has dipped just below Rp. 9,000 again. The gap has closed...



He is also building a checklist of the improvements which he is keen to do on his W 202. The car is beginning to have that nice smooth and shiny feel to the body. Guess all those biweekly trips to Medicars at Pondok Indah Mall begins to pay off.



Has your correspondent managed to escape the shackles of work? Well he is quite proud to admit that he only read and replied to four work-related emails on his first official leave day. The phone is switched off so he is not immediately contactable.



So far so good, let's see what other "homeworks" your correspondent will get tomorrow ...

The forgotten "father" of the Republic

He travels well and often uses secret and different identities, depending on which country he is on. At each country, his secret mission is often compromised and he has to use all at his disposal to escape from his nemesis. In every mission, there are often attractive female "friends" who is sympathetic with him. There are times when he was caught and thrown into prisons but he always escaped.

This is not a fictional biography of James Bond but rather the non-fictional history of Tan Malaka. In the folklore of the new order, Tan Malaka is he-whose name-should-not-be- mentioned. He occupies this place along with other politicians , who, deemed dangerous by both the 'old' and the 'new' orders, who found that there was a systematic cleansing of collective memory. This purge was achieved through a combination of a ban on their publications, their relatives shun by their neighbours and employment opportunities (especially the civil service) for relatives suddenly closed shut before their eyes.

But, thankfully, through the works of both established media (the respected newsweekly "Tempo" recently ran a special edition of Tan Malaka, titling the edition "the forgotten father of the Republic") and the alternative press (it's difficult to name them all) , the young-ish generation starts to hear an alternative version of the story of Tan Malaka.

At the risk of a spoiler effect, your correspondent decides not to divulge the details of the special edition. Needless to say it does seem a pity that Tempo appears to focus solely on Tan Malaka's side of the story and less on the 'establishment' side of the story. Understandbly there are reasons behind this, not least is probably that Tempo could have felt that sufficient time has been allocated to give the "official" version.

Your correspondent obviously is not a historian but in the process of reading the special edition, he obtains the impression that maybe Ibrahim (which is Tan Malaka' s real name; Datuk Tan Malaka is a title passed to him by his Clan) is a normal politician after all.

More to follow ...

Absolute power, corrupts absolutely

News , by definition, are information which had hitherto been unknown or not made public. When a former Indonesian MP accused his past and current colleagues of accepting funds for passing legislation, arguably this could not be accepted as news. The fact that the stories remained at the forefront as this newspaper hit the press, even attracting the president to call in his two MPs-turned-cabinet members, suggests otherwise.



There have been accusations of MPs receiving facilitation payments in the past. Some have been convicted. Unfortunately those have been the exception rather than the rule.



The rule unfortunately is the cases were lost in the maze also known as the Indonesian legal system. The cynics have termed this system the case trading system. This newspaper's recent report on deputy attorney generals caught on record as receiving payments from lobbyists was but a recent example of just how corrupt the 3rd branch of government is.



So is there hope for a corrupt-free society and a just, fair legal system? Or is it like waiting for Godot?



More to follow ...

Light at the end of the Tunnel ?

As crisis goes, the inability of Indonesia's PLN to supply sufficient electricity, is not as life-threating as , say, the financial meltdown in the late 1990s. Put it simply, the probability of this "Power Crisis" to follow THAT meltdown into standard Economics textbooks are rather low. Nevertheless, hardly a day goes by this week without the front pages screaming one powerful headline after another.

Faisal Basri, a respected Economist, noted that the problem has been identified for some period of time. It is therefore a bit of a mystery why has this issue seen the light of day only in the last week or so.

Mysterious as it is, the problem is quite serious. Every other day, a small section on the respected Kompas daily carried a list of areas which will experience black outs. Both household and industrial customers are affected by the scheduled black outs. The area where your correspondent lives was supposed to have the pleasure of black out experience today, Monday July 14th. Through a stroke of good luck or otherwise, no black out has occured. Such is the nature of the crisis that while visiting an advisor who is ill in Singapore, the president arranged a meeting with an unnamed group of nine Singapore-based businessmen, that his administration is on the case.

In this newspaper's opinion, there is one additional solution that the country must consider. I am of course refering to Nuclear Power.

If Nuclear Power were a brand name, its reputation is quite radioactive. What with Chernobyl and the Three Mile Island "incidents" entering the folklore, it is understandable why governments around the world aren't automatically warming about it. And yet the facts speak for themselves. The current Nuclear power plants are state-of-the art and have received a lot of improvements. France is oft quoted as a shining example where nuclear works: its citizens enjoy one of the lowest electricity bills in the world, and its air is not mixed with CO2.

Of course there are drawbacks. Cost of building a nuclear plant is not exactly cheap. Then there is the age-old question of where to store the waste fuel.

Against these negatives is the ace card. Unlike power plants running on fossil fuels , whose supply as we know are located in suspect governments, nuclear runs on plutonium. Australia , which arguably is more stable than, say, Russia or Kazakhstan, control among the world's largest deposit of plutonium. Supply to Indonesia. This newspaper contends that the government should look into Nuclear, along with Biofuels, Wind and other alternative form of energy.

Book review : The Man from Pare Pare

Presidential memoirs are not exactly on the list of endangered species. A recent visit to a local bookstore chain resulted in no less than 50 titles, dominated by the Soeharto presidency. With this kind of competition, one might wonder if there is a place for one biography of the "accidental president", B.J. Habibie.

Surprisingly (or not ?) , his 512 days in office has so far proved to be less than popular, as measured by the number of books about it. The president himself penned the notable "Detik Detik yang Menentukan" in late 2005, a book which was well received. To latest addition to this slim compendium so far is written by A. Makmur Makka, a former aide.

Reading this work, one feels as if one is watching the "coming soon" clips while waiting for the main feature in a cinema. One only gets to see glimpses , not details. Unfortunately, the clip can't help since the movie is less than watchable.

This memoir appear to be targeted at archivists (did I see anybody raising their hands ?) who may have lost plenty of official documents. For that is surely one's perception , since a majority of this work is a list of government policies and statistics. This is rather surprising, considering memoirs are supposed to give the readers an insight into the subject's thoughts and personalities.

The author skims through arguably most of the subject's life (also a surprising choice, considering a memoir is commonly used to share the subject's life, from childhood onwards). Not too many new , previously unknown details emerged.

More critical reviewers (in case readers have not noticed, your correspondent is not one of them) is likely to judge this work as a mea culpa. Plenty of pages are devoted to the objectives, background and benefits of why Indonesia had to be able to produce the CN-235 and the N-250. Practically no airspace was allocated to why the precious state budget should not have been spent building more bridges, paying higher salaries for teachers and professors or others of that ilk.

In the end, this book tells something else about us as a nation. Our leaders' memoirs focus on what they did while they were in power. It unwittingly gives away the conclusion that after reaching the top, our leaders are not doing anything useful. In your correspondent's view, they should consider devoting their time for the improvement of Indonesia's situation. In this, your correspondent applauds President Habibie's Centre who is consistently pleading the case for democracy and human rights in Indonesia.

(The book is "The True Life of Habibie: Cerita di balik kesuksesan", A. Makmur Makka, IMAN 2008)

Change we can believe in

In the campaign for the presidency , he is a young-ish politician with a message for change. He garnered large sway of support, even as he is fighting against a candidate, coming from arguably one of the most famous political dynasty in the country . In his quest for the presidency, his opponents lashed out charges a plenty yet he remained calm and managed to sooth raw nerves with his eloquent speeches.

Barrack Obama? Hardly. How about SBY. Four years later, he has arguably done a good job in increasing the international standing of Indonesia.

So can speeches make a good leader? Can Obama deliver ? Is SBY delivering on his promises ? Arguably some of the best speech ever dellivered were made by exceptional leaders. Winston Churchill's speeches (or sections of them) are oft quoted and emulated even to this day and age. He is near-universally accepted as a great leader. More recently, President Reagan earned a reputation as "the great communicator" and he is credited with bringing the US out of a long recession , as well as effectively ending the cold war. Closer to home, President Soekarno is known as a stirring orator , a skill at present appears to be lacking in his familial successors.

Of course delivering good speeches are but a small trait every good leader should never leave home without. The other traits are experience, street credibility and that most elusive of them all, the ability to lead his/her charges.

Arguably, Obama lacks experience in running big size organizations (running between aisles of the U.S. Senate, especially for four years, is not exactly comparable to running a country). SBY scores better on this, considering he actually commanded big group of soldiers up to provincial level). Winston Churchill is an odd outlier, having led man in battle (a soldier in the Boer war) and led men in the posh party also known as the Tory party. Reagan's experience in leading the actor's union arguably helped him when he had to fight against other politicians (a species known to be prone to having more than one face).

Street credibility is rather a loose term but it is influenced by past successes or the perception of actually knowing what needs to be done and how to do it.

Finally, that final test, the success in leading the people. At least SBY had 3 years of actually leading a country and not 8 months of running for president. For better or for worse, the act of actually doing " it" , is the best way to answer how successful or not a leader is. The jury is still out for SBY but the jury has not even sat for Obama. Perhaps Obama is best served to return to his childhood city and have a word with its president.

Bombs Away

The recent arrest of bomb makers in Palembang, South Sumatera, was an implosion in your correspondent's confidence level of the security situation in the country. In an ironic twist of development, the Australian government had earlier in the same week, declared the situation in Indonesia to be safer and had modified their travel advisory accordingly.

As this newspaper went to press, the details about the bomber and their deadly devices were still pouring out. Fingers are already being pointed towards cells of JI and links with OBL appear to exist.

While this newspaper applauds the dilligence of the SAS-trained 88th detachment special unit, questions linger on how successful have pre-emptive actions and policies been.

As it stands, clearly there appears to be similarities between people arrested in Palembang with other arrests in the rest of the world. These would be young-ish people disillussioned with the general condition surrounding them.

The root cause of such conditions are unemployment and a tendency to surrender to promises to leave behind the ills of the material world for in exchange for eternal happiness.

Clearly this is a classic textbook case normally outlined in standard texts on Economic Development for instance Michael Todaro's authoritative book with the same title. And as even more made clear, there is no one size fits all solution for the issue.

Nevertheless it pays for the government to be vigilant in identifying the trigger points early on and mitigate them accordingly. One of the best gift that the current administration can give to the incoming 2009 winner will be to ensure that the issue does not blow up in their face.

Book Review : Family Ties

Don Corleone was probably right after all. So was JFK. Every family must have its concigliere, every leader must have his/her "Bobby". Anybody watching the U.S. Democratic primaries between Obama and Clinton (Hillary, not Bill), would by now be watching who would get the VP nod. Long time Obamaistas (I believe there is even a Jakarta chapter ?) would probably pray that their anointed leader wouldn't take the "Change" message to heart and change mindset to have Clinton as his running mate.

Are there many "JFK and Bobby" pairs out there ? Leaders who - despite being brothers, even the two Kennedys are poles apart- can trust each other and can almost finish each other' sentences ? Does this partnership work ?

Answering these questions are better done using empirical data. Unfortunately, there aren't that many studies that I know of which can explain this. Frequent readers of this newspaper would have guessed by now that your correspondent has a particular fascination with presidencies. Having just finished two more books on presidencies and those people close to them, a common theme running through them are that gifted politicians definitely have their conciglieres and their bobbies. JFK has of course set the gold standard by having his Bobby who is , well, Bobby.

So what should you look for in finding your "Bobby" ? Here are some personal observations from Evan Thomas' biography of Robert F. Kennedy :

1)Somebody you can trust completely to overlook your failings as a normal human being
2)Somebody that when he /she speak his/her mind has your best interest at heart, and not their own'
3)Somebody that you can be sure will get the job done. Also known as "the enforcer"
4)Somebody that in carrying out your order, will not have too many questions asked
5)Somebody that you can groom to take over your role and you know he/she will not stab you in the back in the process

More to follow

A Convenient Truth

Indonesia's leaders hosted the UN Climate Change Conference in Bali. They probably would prefer to be remembered for that, rather than for being publicly associated with an "invention" to convert water into oil.

In case readers of this newspaper have not noticed by now, your correspondent is a cynical sort.

Laudable as it is, relying on a magic wand (how else do you explain converting water into oil) , is hardly the stuff of first class government in action. Neither is the government attitude that they can walk on water and not expect the voters to remember these magical events.

But the truth of the matter is that global warming is not an easy matter to be resolved. It takes as much scientific innovation as much as political leadership.

But as a nation, for us , "scientific innovation" means Blue Energy (they even have a brand for aqua conversion) and "political leadership" means creation of a taskforce (after a while, the task is ill-defined but "may the force be with you" blessing was given by the leader anyway.

This is one of the reason for my earlier posting , where I urged us to act as individuals and tackle the problem starting from ourselves. As that icon from a bygone era put it , "As each man stands up for an ideal, or acts to improve the lot of others ..he sends forth a tiny ripple of hope ..and by creating millions of energy ...creating a strong current to crush the mightiest walls ..of resistance"

Oh and just in case you were wondering, water apparently was mixed with gasoil to come up with "water conversion".

The Presidents

It is commonly known that "the world's most exclusive club" will soon add another "George Bush" to its list, therefore increasing the total membership into four. It is less commonly known that the club of living ex Indonesian presidents actually have less member (three) and therefore arguably more exclusive.
It is possible that this is due to the stature of the two clubs being markedly different.Bill Clinton set up a foundation to fight obesity, AIDS in africa and climate change. Jimmy Carter also set up a foundation, won a Nobel Peace prize in the process but remained a thorn in the side of his successors - on issues like North Korea and lately, the Middle East. On the other side of the world, an ex Indonesian president also set a foundation and also visited S. Korea at the request of the S. Korean presideny, to 'wage peace' in the Korean peninsula.
Whilst it will be a long time before Indonesia will have her own "41st" and "43rd" father and son presidents (George Bush and, er, George Bush), presidential politics in Indonesia have already been a family affair. Indonesia already have father and daughter presidents (Indonesia's 5th president, Megawati, is the daughter of the first, Soekarno). Megawati has already been nominated as her party's nominee for next year's election (she failed to win a second term in 2004 and was not elected for her "first" term).
Whilst waiting for elections, it is not uniformly common what Indonesian ex presidents do. President Habibie has wrote a book (2006), polishing his Mercedes classic cars collection in Hamburg and met with incumbent President Yudhoyono on June 13th. President Wahid , or Gus Dur as he is more commonly known, has kept his "Presiden Republic Indonesia" hat despite being thrown out by parliament, and has also fought for religious freedoms ( a very noble clause). President Megawati, who served as president Wahid's vice-president has made some eyebrow raising visits to South and North Korea.
Until his death in January of 2008, president Soeharto spent his days cocooned in his Jakarta home before finally succumbing to ill health.
Could and Should they do more in their "sparetime" ? The first question will be answered "maybe" and the second will be answered "yes".

More in the next posting

Hello, Is It Me You're Looking For ?

The key characters in the narrative had no idea that their phone calls are being recorded. One protagonist, Untung, who's a deputy attorney general, received a call from a middle-aged female lobbyist. The lobbyist (Artalyta) was panicking because Udin, a senior prosecutor (who is working for the deputy AG), had been arrested by the anti corruption agency barely minutes earlier. Artalyta was asking Untung to release Udin , fearing that he will drag her into the case. The call ended with the Untung assuring Artalyta that she will be 'arrested' by his office, therefore preventing the anti corruption agency from arresting her too.

Unfortunately, although it has all the makings of a detective novel or political thriller , the event actually did happen. The case involved the alleged pay off of USD 600,000 from Artalyta to Udin who is leading the state's case against her associate, Sjamsul Nursalim, a well known conglomerate in the bad old Soeharto days. Foreign observers or Indonesians growing up on the diet of the Nixon White House's stories of secret recordings (not too many were seen raising their hands filtered with these categories) are somewhat surprised that there is a tap in the first place.

In your correspondent's knowledge of recent cases, the use of phone taps is the first of its kind. It is not yet known who authorized the recording, whether it is illegal and why is it only started to be used now. These questions are critical because if the evidence using the phone taps are accepted - as they appear to be for the moment - it is possible that these will be used for future cases where 'hard evidence' are likely to be hard to find. These may help the government's stated drive to root out corruption at all levels.

Arguably, the disclosure that a deputy AG (who is tasked with bringing to court all those serial corruptors) is actually striking some kind of deal with a lobbyist, will impact how successful the government will be in rooting out corruption ( with or without the phone taps). This is actually the second time that a deputy AG is implicated in the same case in the last three months (the recording also mentioned the name of a third deputy AG), so there is an impression that the AG's office has been compromised.

What is even more exciting is (and so far no journalists have picked this up) is why it took so long for the tapes to surface (the arrest took place a few months ago, which means that the recording has been sitting idily. Or was it a conscious decision that it only now saw the light of day ?) One potential reason is to further embarass the administration of President S.B. Yudhoyono. On the day of the revelation, Australian PM Kevin Rudd paid his first official visit to Jakarta. This may explain why in the same evening, Vice President Jusuf Kalla went on an offensive and turned the news cycle around by suggesting that this is further evidence of how serious the government is, pointing out that senior government officials are not immune and not above the law.

There is truths to this. In that same week, a former chief of national police, was sentenced for alleged corruption during his ambassadorship to Malaysia. A recent visitor to the Jakarta police office's detention house witnessed a former governor and a former regent being detained (albeit in a nice "cell" , said ). As we hit the press, the president has ordered for a full investigation to the case. What ever the result, it appears that the mobile phone will not be a favourite gadget in prison.

Picture Perfect

Indonesia's worst kept secret these days was reflected when an Indonesian oil executive joked to his Pakistani colleague that the Pakistani got the wrong picture of the Indonesian president (in the Pakistani slide pack, it was the picture of President Susilo Bambang Yudhoyono). Indeed the Vice Presidency is widely perceived to be the one calling the shot these days. The latest rumor mill is that Vice President Jusuf Kalla, who heads Golkar Party, may well split the ticket and run separately from his nominal boss in the 2009 presidential election.

What started the latest bout of speculation is Golkar's miraculous discovery that their political interests are not served by the president's cabinet. In two recent cases, Golkar's candidates for provincial governors lost their appeal of the election results. Golkar's 'chief whip' in the House of Representatives (DPR) have publicly threatened to withdraw parliamentary support to the government and claimed that the majority of Golkar's executive board shared this view.

Publicly at least, the vice president have always maintained that his top priority will be to serve out his five year term together with the president. Privately it will be another miracle if a seasoned politician such as MJK (as the VP is known) did not think of occupying the grander presidential palace after a term in the less grander vice presidential palace (the lawns are markedly bigger in the former).

But the series of miracles are not an unusual occurence with Golkar. After 30 odd years as the ruling party under the late President Soeharto, most people and political hacks wrote Golkar off the scene following Soeharto's timely demise from power. However two presidents later, Golkar emerged as the second biggest party in parliament and its chief becomes the vice president.

So what will happen next year ? One scenario is indeed Golkar is pressuring MJK to split and aim for the RI-1 spot. It is possible that following results in other non disputable election results (where Golkar's candidates also lost), Golkar felt its association with an unpopular administration - already , President SBY presided over two fuels price increases, an economy of ever increasing food prices, and an unending series of corruption scandals - would end up hurting its electoral prospects.

Another scenario is that some people believe that MJK is acutely aware that he will not make President. There is an unwritten rule that Indonesian presidents must be Javanese. MJK comes from South Sulawesi and may well decide that he is better off to throw his lot with President SBY.

But in case MJK changes his mind, he has a precedent. President B.J. Habibie who was in charge for two years serving out Soeharto's term was the only non Javanese; he also hails from South Sulawesi. In such an event, the Pakistani executive would be well served to change his slides once and for all.

Winds of Change

If you're reading this, it is a fair guess that you first stumbled upon the Library's web address at a recent series of columns I wrote for a free magazine. So it may make sense to focus my scribblings on career advise, for indeed, that was the topic of my monthly column.

Alas, I have had to cancel my column and so I am now in a dilemma as to what should I focus my writing on.

At one hand, I have had fairly positive responses to my columns and to my previous writings on the same subject when it appeared at a national newspaper in 2005. On the other hand, I feel that I am keen to share some thoughts about one or two other things as well.

And so I will now also start writing about life as Indonesian in these times. My objective is to take the mantle of the mission of Walter Bagehot when he set up The Economist " to take part in a severe contest between intelligence, which presses forward, and an unworthy, timid ignorance obstructing our progress"

And so my writings will probably be focusing on politics, and leadership in politics in Indonesian, on the Economy and dare I say on business.

I hope to hear direct feedback from you as reader soon.

Moral Hazard

In my previous blog post, I had mentioned about Global Warning. Of course I meant that as a word play on the global warming phenomenon now engulfing the world.

What I will now say is also a bit of a word play, albeit of another one.

For the economists among you (they do exist), the term moral hazard is likely to bring back memories of reading a chapter either on Lipsey Steiner "Principles of Economics" or Paul Samuelson's "Economics". Of course I am refering to the case of the central bank rescue of a failed lender , arguably with the good intention of saving the savers, but in effect resulting in providing an incentive for other lenders to be reckless (because they know they will be bailed out by the central bank).

So I hear you say what does this have to do with anything? Well I beg to differ. This moral hazard as it turns out are prevalent in other institutions as well. So my plea is for the managers among you (o ye they also exist) to be wary if you are at the receiving end. Do not be easily accept a request such as these which will reflect poorly in your function's performance.

So the morale of the story is have an wider view of the situation prior to making a commitment which you may regret later. This is hardly rocket science, but sometimes this view gets lost in the jungle of exotic terms we face these days.

Global Warning

It has been sometime that I have contributed to this and my apologies for those of you who asked me about it. I have been detained on pressing issues and only now can find the time to put pen into paper.

I would like to take this opportunity to share some observations on the matter of “ Global Warming”. I believe we find ourselves (as Indonesians) at a very important time in our history. We have been as a nation for 60 + years and we have not played a part in, and if not the, definitely one of the most difficult challenges we as humans have faced.

Of course, I hear you say, that it is blindingly obvious. But how many times have we hear lately that all the right things have been said at the strategy level, but nothing is happening at the operational level.

And so I firmly believe that we are poor in execution. Politics aside, we tend to hear more people identifying what is wrong but we tend to see less people actually suggesting good solutions for a problem.

And so , true to my own critiques, here are my suggestions :

* Change light bulbs in all houses including presidential palaces and government buildings into energy saver light bulbs
* Open window curtains in the morning so not all lamps need to be turned on
* Timer on aircondition, so it is only when the weather is unbearably hot
* Adopt efficient driving techniques
* Identify activities which are adding to CO2 emissions and find ways to do less of them

I know they are not original, so let me know your tricks that you are currently doing. We can share them to others...