A
political-economic view of a Jokowi-Kalla Candidacy
Fachry
Ali ; The co-founder of the Institute for the Study and
Advancement of Business Ethics
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JAKARTA
POST, 05 Mei 2014
Although
Joko “Jokow“ Widodo generated a less spectacular effect for his Indonesian
Democratic Party of Struggle (PDI-P) in the April 9 legislative election, he
remains favorably positioned for the July 9 presidential election. We need
just one word to explain this: “populism”.
But it
needs more than one word to explain why “populism” is so marketable today.
This is related to the “counter-elite” image projected by the Javanese
traditional popular stories, especially in the wayang (shadow puppet) world, where the wong cilik (little
people) also play a role.
Semar,
for instance, is a respected person. Having three children (Petruk, Gareng
and Bagong), Semar symbolizes not only the common people in the wayang social
structure, but also a titisan (incarnation), an incarnation of a god.
In a
normal political situation, Semar and his children often act as critics. But
in a crisis, they take a leading role to bring the situation back to
normality.
It is
upon this publicly digested traditional cultural discourse where Jokowi’s
meteoric political career resides, for his appearance hints at the elite’s
failure to perform their duty. Jokowi’s populism therefore is the antithesis
of the previous elitist tendency.
Rhetorically,
his populism meets the partai wong cilik (the party of the little people),
jargon of the PDI-P. Their symbiosis brings profound cultural and political
effects that Jokowi’s political popularity is a pasemon (allusion) to the
current Indonesia’s radical elitism.
However,
this populism is problematic in terms of economic policies. His populism
invariably leads him to pursue a people-based nationalistic economic policy.
Though its details remain to be seen, it is quite likely that his aides will
point to Keynesian economics as a basis of his economic policies, for it
allows state intervention in the economy.
Will
Jokowi be able to realize it? This is crucial, for what he will face will not
only be the domestic capitalist oligarchs. He will also have to deal with the
interlinked relationship between the global dynamic and domestic economic
sustainability. A simple example is the unfavorable situation faced by
Indonesian contractor companies in the 2015 ASEAN Economic Community (The Jakarta Post, March 17).
This
ever-growing economic community will open huge opportunities in the
construction sector for its Gross Domestic Product (GDP) is estimated to hit
US$2.1 trillion. But, the domestic bank interest rate stands at 13.5 percent,
Indonesia’s contractor companies cannot be optimistic. For this interest rate
is too high compared with Malaysia, Thailand and Singapore, which range
between 3 to 4 percent. This means Indonesia’s contractor companies would be
less competitive.
Hypothetically,
if this was faced during the Jokowi presidential period, his populist-nationalistic
tendency would theoretically tend to lower the bank interest rate to
strengthen national companies’ competitiveness.
However,
this measure will strike unpredictable economic reality. In addition to the
central bank’s independent status where its policies are free from any
intervention, this tight monetary policy is driven by forces beyond political
authority: Current account deficit, an unbalanced import-export ratio and
capital outflows as the consequence of the tapering of the US Federal Reserve
is quantitative easing policy since the end of 2013.
This
leads to other negative results such as foreign reserve depletion, automatic
domestic currency depreciation and a surge in inflation. This economic
reality thus reduces the state autonomy in economic policy making. Both
Jokowi’s populism and the PDI-P’s partai wong cilik jargon would be
challenged by this structural condition.
It is in
this context, if chosen as Jokowi’s vice-presidential candidate, Jusuf Kalla
could be a valuable partner for him. Kalla is not only a seasoned
vice-president (2004-2009), but it was he, during his vice-presidential
tenure, who took brave crucial and strategic economic policies.
In the
case of Keynesian economics, it was Kalla who introduced the direct cash
assistance (BLT) program to soften the people’s negative impact from the
government’s fuel subsidy cutback in 2009.
And it
was Kalla also who directed state-owned banks to form a budget consortium to
finance the Java-Bali toll roads. It must be kept in mind that Kalla’s
measure was taken at the time amid the lowest point of bank intermediacy
function.
Kalla is
thus not only in line with Keynesian economics, but also possesses “valor” in
making use of state resources both for the sake of the people’s interest and
the productive purposes.
It is
still an enigma, surely, how Kalla will successfully deal with the House of
Representatives (DPR) in launching economic reforms. For while notoriously
known for being plagued by vested interest-based factionalism, the House has
decisive power and the government invariably needs its approval of any
economic policy.
I have
no special answer to this intricate question. But referring back to what he
did during his tenure, Kalla had not only repeatedly succeeded in taking
sensitive economic decisions with less public uproar, but was agile enough in
the diplomatic field.
It was
Kalla who was able to end the 30-year-old Aceh conflict in 2005. Kalla
perhaps is a prodigy of a talented public official for he has the ability to
gear interchangeably between economic expertise and diplomatic skills.
Isn’t facing the DPR substantially a
diplomatic battlefield?
In conclusion, the Jokowi-Kalla duet will respectively strengthen each
other. As the most popular presidential candidate, Jokowi has potential to
win enough votes. But, once chosen, he will soon face domestic capitalist
oligarchs and the global inter-linkage-induced ups and downs of the national
economy. This would likely reduce his popular-based political legitimacy.
As a businessman, Kalla is not only rich with experience in handling
the economy, but also possesses a special ability needed to ward off the
domestic capitalist oligarchs’ intervention as well as the House’s pressures.
He is
too old to be Jokowi’s next competitor for the 2019 presidential election. Kalla’s main function would thus be confined only as
Jokowi’s guide in facing the oligarchs of domestic capitalists and the puzzle
of the global economy — providing valuable capital for Jokowi. ●
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