The Rise of Middle Class and Changing Concept of Equity (H.W Dick, 1985)

7/29/2019 The Rise of Middle Class and Changing Concept of Equity (H.W Dick, 1985)

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The Rise of a Middle Class and the Changing Concept of Equity in Indonesia: AnInterpretationAuthor(s): H. W. DickSource: Indonesia, No. 39 (Apr., 1985), pp. 71-92Published by: Southeast Asia Program Publications at Cornell UniversityStable URL: http://www.jstor.org/stable/3350987 .

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THE RISE OF A MIDDLE CLASS AND THECHANGING CONCEPT OF EQUITY IN INDONESIA:AN INTERPRETATIONH. W. Dick

Introduction 'Continuities in values and institutions in themselves reveal nothing aboutthe direction of social change, although they may provide some indicationof its speed. The significance of traditional values and institutions liesin their interaction with new elements. To understand social change it isthereforeupon the new elements that one must focus. To do otherwise is like

runningbackwards,being able to see where one has come frombut not whereone is going.This article argues that a crucial new element in contemporaryndonesiais the emergence of an urban middle class. The origins of this class canbe traced back on the one hand to the civil servants and intelligentsia whowere the product of liberalized higher education in the late colonial periodand, on the otherhand,to the mucholder groupsof Muslim nd Chinese traders.The achievement of national independence in 1949 marked the first stage inthe consolidation of this new class. After the hiatus of "Guided Democracy"(1959-65),the second stage began with the establishmentof the "New Order"governmentn 1966. The restorationof political stabilityand the unprecedentedprosperity f the oil boom of the 1970s has enabled this middle lass to flourish.1. This article has been written in fits and starts over about three yearsand mainlywhile I have been a Visitor in the Departmentof Economics,ResearchSchool of Pacific Studies at the Australian National University. For commentson earlier drafts am mostgrateful o AnneBooth,ChrisManning, eter McCawley,David Penny, Tony Reid, and Thee Kian Wie. I have also benefitedfrom thevery stimulatingdiscussion which followed my presentation of a seminar onthis topic for the Centre of Southeast Asian Studies at Monash Universityin April 1982,and from he fair and constructive riticisms f the referees.2. This was an issue of great interest (at least to foreigners) in the earlyyears of independence, when it was still expected that Indonesia would evolve asa liberal democracy. It was the focus of the classic monograph y RobertvanNiel, The Emergence of the Modern Indonesian Elite (The Hague: van Hoeve, 1960)as well as J. M. van der Kroef, Indonesia in the Modern World, 2 vols. (Jakarta:Masa Baru, 1954 and 1957). Since then the focus on the "elite" seems to haveblinded social scientists to its middle-class nature. A rare exception isDan Lev in his studies of Indonesian lawyers, for example "Origins of theIndonesian Advocacy," Indonesia 21 (April 1976): 135-70 (esp. pp. 160-64).J. A. C. Mackie, Indonesia since 1945:Problems fInterpretation"nContemporaryIndonesia: Political Dimensions Clayton,Vie.: MonashUniversity, 979)recognizesthe importance f the middle lass but refers to it onlyin passing.

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72It is remarkablethat no analysis of the New Order has yet taken account ofthis phenomenon.One important onsequence of the consolidation of a middleclass has beena changingconcept of what constitutes equity. In precolonial Java the peopleclaimed, and rulers acknowledged,a right to an adequate subsistence. Inother words, the primary oncern was with absolute poverty. This was alsoat the root of the Ethical Policy in the late colonial period. The emergenceof a nascent Indonesianmiddle lass was accompanied yan intellectual commitmentto socialism and equality, which later became the ideological basis of "GuidedDemocracy." In other words, the emphasis shifted to a concernwith relativeinequality. Althoughthe New Ordergovernment as looked with disfavoruponsocialism,underpopular pressure t adopteda commitmento equality pemerataan)as a state objective which was writteninto the Third Five Year Plan (RepelitaIII, 1979-84). The new fashion of "Basic Needs" now espoused by internationalagencies such as the WorldBank, however,harks back to the traditional idealof an adequate subsistence. Thus, not only is there a lively debate bothinternationally and within Indonesia over developmentand equity, but alsothe interpretation f equityis itself in a state of flux.This article is an attempt to explore the relationship between the riseof a middle class and the changing concept of equity, and its relevance toeconomic policy. The first section considers the interpretationof the term"middle class." This is followed by an extended discussion of the conceptof equity in precolonial Java. The three succeeding sections review the linkbetween equity goals and economicpolicy in the twentiethcentury:first underthe Ethical Policy of the late colonial period (1901-42); hen after independenceand during the subsequent period of Guided Democracy 1959-65); and finallyunder the New Order. The conclusiondraws out someimplications f the analysis.The MiddleClass

The term "middle class" means differentthings to differentpeople. Asthe term is of European origin, its usage in this article may be clarifiedby some brief reference to that context. In feudal European society, whichwas predominantly ural, there was no middle class. Apart from the Church,there was onlya land-holding pperclass and the common eople. A monied lassof traders and artisans, whose wealth was derived from ommerce ather thanland, existed outside feudal society, as reflected n the Frenchword"bourgeois"(townsman).* Marx borrowed the term "bourgeoisie," with its connotationsof money and wealth, to denote the owners of the means of production. Hewas thereby able to define mature capitalist society, like feudal society,as having only two basic classes. Feudal society was polarized between thosewho held land and those who did not, whereas capitalist society, accordingto Marx, was polarized between those who owned the means of production andthose who did not. By this intellectual sleight there was, in theory, stillno middle class. The term "middle class" can be used with its commonsenseEnglish, Dutch, or German meaning, however, to identify a group distinct fromeither an upper class of feudal origin, holding power and wealth by virtueof birth, or a lower class of peasants and workers, lacking power, wealth,and even education. This middle class has education, some wealth, and whatever3. Henri Pirenne, Medieval Cities: Their Origins and the Revival of Trade,trans. Frank D. Halsey (Princeton: Princeton UniversityPress, 1948) is stillan excellent discussion of this point.



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Table 1. AverageMonthly xpenditure by MainCategories, UrbanJava (1978)ExpenditureGroup Rp/month]

Expenditure _2,000 2-2,999 3-3,999 4-4,999 5-5,999 6-7,999 8-9,999 10-14,999 1 1Item 2.1 7.5 12.2 9.3 9.7 16.6 10.5 15.5Basic Starchesa 775 1,048 1,211 1,265 1,317 1,362 1,398 1,495 1,OtherFoodb 486 932 1,396 1,881 2,422 3,144 4,058 5,299 9,CLothing 33 67 122 184 215 297 382 526 1,Housingc 245 367 534 781 973 1,276 1,778 2,621 8,Taxes & Insurance 7 17 25 35 59 81 125 223Other 69 122 230 377 485 815 1,183 1,957 6,Total (Non-food] 354 573 911 1,377 1,732 2,469 3,448 5,327 16,TOTAL 1,615 2,553 3,518 4,523 5,471 6,975 8,904 12,121 27,a. Includes cassava.b. Includes beverages, cigarettes.c. Includes fueL, Light, and water.SOURCE:Biro Pusat Statistik, SurveySosiaL EkonomiNasionaht TahaDKe-Lisa [Jakarta, 1978).



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74power it has been able to win from the aristocracy. In all three respects,however, the definition of the middle class is a residual one. Where themiddle class can be identified ui generis is in termsof lifestyles and values.These are best described, unpejoratively and with an urban connotation, as"bourgeois." In this regard it is still meaningful o talk of a middleclass,even though in most Western democracies (includingJapan) it has absorbedthe upper class, stripped of its power and economic privileges, and ceasedto be "middle" n anystrict sense.Although t has often been said that in Indonesia there is no middle classbut onlya wealthyelite on theone hand and a poverty-stricken asson the other,this is too simple a view. The new Indonesian elite is a middle-class/bourgeoiselite. There is no longer an upper class. The hereditaryaristocracy hasceased to be of any consequence. Althoughthe leaders of the Armed Forceshave sought in the doctrine of dwi fungsi (dual function)to legitimize theirposition as trustees for,and natural rulers of, the people, they hardly onstitutea newupperclass. Reform f the ArmedForces along rational bureaucratic ines,with entrance to the officercorps at least partly on the basis of educationalperformance,has ensured that ArmedForces' officers will remainclosely tiedto the middle class and not in the foreseeable future become a hereditarycaste. The extravagant lifestyles of leaders of the ArmedForces, far frombeing aristocratic, are typicallynouveau riche, displaying to the point ofcaricature the material aspirations of the middle class. Their conspicuousconsumptions unsoftened yanytrace ofnoblesse oblige. In termsof occupationand status, wealth and power, the Indonesian middle class is amorphous: ivilservants (including teachers and academics), professionals such as engineers,doctors, lawyers, journalists, airline pilots, and business executives, other"white collar" workers, and, of course, employers. Lifestyle and attitudes,however, provide the underlying oherence of an urban middle-class culture.It is most evident in Jakarta but, being diffusedthroughoutthe country bythe powerfulmedia of education, television, and magazines, is becomingthenational culture.With regard to material lifestyles, some indication of the size of themiddle class can be gained fromthe expendituredata in Table 1. Definitelymiddleclass are the 16.6 percentof individuals n urban Java whose expendituresin 1978 were greater than Rp 15,000 per month. The distribution of theirexpenditure is also revealing. While their expenditure on staple starcheswas not markedly bove average, it was verymuchhigher n the case of "otherfood" (i.e., including "luxury" items such as meat, cheese, and alcoholicbeverages), housing, and "other" (i.e., mainlyconsumerdurables). That themiddle class is an essentially urban phenomenon s shown by the fact thatonly1.1 percentof those in rural areas had expendituresgreater than Rp 15,000,and much of this was probablyaccounted for not by rich farmers but by thespillover of urban-based ctivity nto rural zones.*The importanceof consumer durables in the expenditure patterns of theurban middle class is supported by data on ownershipof consumption ssets.Based on the careful tabulations of Roger Downey,Table 2 shows the accessof those in urbanareas bysocioeconomic ategoryto the most valuable consumeritems--cars, motorcycles, television sets, stereo sets, and refrigerators.4. This is apparent from he workof Roger Downey,who has classified "rural"dwellers by socioeconomiccategory: "Indonesian Inequality" (PhD dissertation,Cornell University, 983).



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TabLe 2. Access to Major Consumer urables by Socioeconomic Group Urban)(Percentage of individuals with regular access)

Car Motorcyce TV Ref ig StereoSeLf-empoyed professionals 17.2 22.6 34.1 17.9 14.3Managersand Supervisors 15.4 36.6 37.7 16.7 13.2MiLitary 13.7 37.9 36.4 12.2 9.3Professionels (non-teachers) 12.2 34.8 36.9 15.3 11.9Empoyers 12.1 27.7 31.2 14.7 9.9Teachers 5.9 32.6 23.1 7.6 7.1Higher CLerical and SaLes 5.7 29.5 30.3 9.2 8.7OtherSeLf-empLoyed 2.9 9.3 9.8 3.2 2.8OtherCLerical and Sales 1.8 9.7 10.5 3.0 3.1Manual Workers 1.3 5.8 7.1 1.8 2.0SOURCE:RogerDowney, Indonesian Inequality" (PhD dissertation, CorneLLUniversity, 1983).

As mightbe expected, self-employed professionals, managers and supervisors,military, professionals (excluding teachers), employers, teachers, and higherclerical and sales personnel all have much better access to these goods thanother self-employed (petty traders, etc.), lower clerical, sales and servicepersonnel, and, especially, manual workers, even though some individuals inthe latter categories earned sufficient income to appear to be on the fringeof the middle class. By contrast, only the tiny group of farmers owning morethan 5 hectares had a level of access to consumer durables approaching eventhat of manual workers in urban areas.

Membership of the middle class is not, however, just a matter of levelsof income and expenditure. It is sharply defined by social behavior, reflectingwhat may be described as the privatization of the means of consumption. Thisis readily apparent from the contrast between middle-class and kampungsociety.In the latter, the urban society of the common people, consumption assetssuch as transistors, bicycles, and crockery are shared ("borrowed"), as wellas money,and are to some extent communalproperty. A refusal to lend somethingis regarded as antisocial. Houses are left open to anyone who wants to dropin or walk through. What one has is a matter of common knowledge. It isthe social pressure to share possessions, as well as the lack of privacy,that tends to drive the more prosperous out of the kampung, either physicallyor socially.' Their houses are likely to face away from the kampung onto5. Good descriptions of kampung society are John Sullivan, Back Alley Neighbour-hood: Kampung as Urban Community in Yogyakarta, Working Paper No. 22 (Clayton,Vie.: Centre of Southeast Asian Studies, Monash University, 1980), and PatrickGuinness, RukunKampung: ocial Relations n UrbanYogyakarta"PhDdissertation,Australian National University, 1981).6. Sullivan, Back Alley Neighbourhood, refers to the distinction betweenthose who are "in" and those who are "of" the kampung.



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76the street and the amorphous outside world. In order to establish and defendtheir exclusive access to the goods they have purchased, their doors are likelyto be locked and their windows barred., Once a family has fled the orbitof kampung society, the only constraint upon its level of consumption is itsown income, and the ever-present threat of theft. The essential selfishnessof middle-class consumptionalso stands out in comparisonwith the old aristocracy:there is no acknowledgmentof noblesse oblige.

To avoid the many ambiguities of the terms "middle class" and "bourgeois"it mighttherefore be less confusing o refer instead to a "consumer lass." Ifthe termwere understood o refer not to the essential consumptionfnecessities,which is commonto all, but the inessential/excess/luxuryonsumptionwhichis enjoyed only by the economicallyprivileged, then it would be both specificand workable. To the extent that lifestyles can be quantified in terms ofexpendituredata and the ownershipof consumption ssets, it would also bemeasurable. But, as the rest of this article is concerned to argue, valuesalso matter. It is more meaningful o speak of values and attitudes whichare bourgeois or middle class than "consumer lass." I shall thereforewillfullypersist in using the former, ut accordingto common sage and not as precisesocial science terms.Equity n Traditional Java

The kingdoms f precolonial Java such as Majapahit and Mataram have aptlybeen describedas "agrarian empires."' Their economicbase was wet-riceagricul-ture. Technologywas premodernbut, nevertheless, highlyproductive. Withsufficient land, irrigation, and water buffalo, but without improved eedsor fertilizers, an average familycould produce each year up to 2 tons ofmilled rice equivalent, including he supplementary roduceof the house garden.,In theory, they could surrender almost half of the rice harvest in taxes andstill be providedwith an adequate subsistence. The economywas thereforeable to generate an economicsurplus to support a large rulingclass. In theabsence of technical progress, however, the tax base could be increased onlyby proportionate increases in inputs of land and labor. Good virgin land wasplentiful. Labor would seem to have been the scarce factor of production.One of the major aims of statecraft was therefore to maximize the size ofthe population under a ruler's jurisdiction. New settlement and irrigationworks were importantmeans to this end. A wise ruler thereby ncreased histax base in the form both of corvre labor and of rice. From these flowedthe splendorof his court and the might f his army. o7. Guinness,"RukunKampung," ffersa good insight nto the tensions betweenthe kampung wellers (orang kampung) nd those better-off eople whose housesface onto the street (orangpinggir alan).8. This concept can be traced back, via Wittfogel nd Weber,to Marx's "Asiaticmode of production." Marian Sawyer,Marxism nd the Question of the AsiaticMode of ProductionThe Hague: Nijhoff, 977) s a good recent historiography.9. David H. Penny, "Some Aspects of the Problem of Overpopulation n RuralJava" (mimeo,1973) and Anne Booth, "Accommodating GrowingPopulation inJavanese Agriculture," Seminar Paper (Research School of Pacific Studies,AustralianNational University,March 983).10. Soemarsaid Moertono,State and Statecraft in Old Java (Ithaca: CornellModern ndonesia Project, 1973) is the best studyof governmentn traditionalJava, applying pecificallyto the Mataramperiod.



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77In such a society, equity was the fundamental "economic" problem. Thelevel of output was determined primarily by the extent of wet-rice agriculture,which, in turn, was determined by the size of the population. Apart from sometrade, the economic base was narrow and technology almost static, so that the

allocation of resources was straightforward. There was scope for growth inthe size of the economy, but not in output per capita." The distributionof output, however, was complex. It can best be understood in two stages.The first stage was the division of output between surplus and subsistence,which corresponded to the basic social distinction between rulers (wong gede)and ruled (wong cilik). This involves what has been referred to by Scottas the "moral economy" of the peasant,. Scott argues compellingly that themaintenance of some minimum satisfactory level of subsistence is the basisof peasants' behavior and their attitude toward the ruling class. The limitationof his argument is that he never goes beyond subsistence as a concept to specify,from the peasant viewpoint, some standard of livelihood. As far as Scottis concerned, subsistence is what it is. If the level of subsistence cannotbe specified then neither can the size of the economic urplus. It is suggestedbelow that, in the case of Java at least, there is a way out of this impasse.Once a surplus has been extracted, the second stage of the process is itsdistributionamong membersof the ruling class. This involves the workingsof what Weber alled the "patrimonial tate."Javanese peasants have a fairlyprecise ideal of what constitutes an adequatesubsistence. Their term is cukupan,which iterally translated means "enough."David Penny and Masri Singarimbun, he first authors to have attempted toapply the concept in economicanalysis, argue that cukupan represents a realincome of 1200 kilograms of milled rice equivalent per familyper year. 'This is sufficient for a familyof two adults and three children to eat riceall year round with a few side dishes, to be simplybut respectablydressedon formal occasions, to be simplyhoused by modest village standards, andto be able to save a small amount for securityand to cover future life-cycleceremonies. "Cukupan" ncompasses uttranscends he basicbiologicalrequirementsto sustain life. About half of this quantity of milled rice equivalent wouldbe required to feed a familyof five people at the rate of 120 kilogramsperperson peryear,whichwouldprovide bout75percentof minimumailyrequirementsof 1600 calories. Although the large part of the balance of 1200 kilogramsof milled rice equivalent is surplus in strictly nutritional terms, it isnot surplus in social terms. Being respectably clothed on formal occasions,living in a proper house, and therebybeing able to hold and participate inthe life-cycleceremonieswhichmark the tempoof village life are not luxuries,but basic to man's identity s a social being. The thirdelement of the conceptof cukupan is a sufficientmargin to provide security against the inevitable,11. See Booth, "Accommodating GrowingPopulation," for a discussion of"static expansion" in the late nineteenth and early twentieth centuries.There is no reason to believe that the situation was any different n earlierperiods.12. James C. Scott, The Moral Economyofthe Peasant (New Haven: Yale UniversityPress, 1976). His argument draws upon the substantial literature of peasanteconomics, of which Alexander V. Chayanov, The Theory of Peasant Economy,ed. Daniel Thorner, Basile Kerblay, and R. B. F. Smith (Homewood, Ill.: Irwin,1966) has been particularly influential.13. David H. Penny and Masri Singarimbun, Population and Poverty in RuralJava (Ithaca: N.Y. State College of Agriculture, Cornell University, 1973).



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78but unpredictable, fluctuations in harvests. Scott has documented for Burmaand Vietnam, and there is ample evidence from elsewhere in Asia, the vulnerabilityof the peasantry when such insurance can no longer be provided from its ownresources. In Java, where harvests are fairly reliable, the margin for insuranceseems to have been fairly small. The importanceof the concept of cukupanis not that peasants recognize food, social life, and security as basic toman's existence, but that they can specify quite closely the minimumevelof real incomewhich enables those needs to be met.

Penny and Singarimbun rgue that the meaninggiven to cukupan has notchangedfor a long time. There has been no "revolutionof risingexpectations":The real level of living impliedhas not changed with the adventof roads and railways,whichopened new marketopportunities astcentury; with the arrival of modern irrigation, fromearly inthe twentiethcentury;or followingthe arrival of good rice seeds,fertilizer and pesticides, which started in the 1930s and whichhave been pushed quite hard since the mid 1950s and particularlysince 1968 n the so-called Green Revolution.Moreover,while the concept of cukupan predates the marketeconomy, ar fromturningthe concept into an anachronism, he evolution of the marketeconomyhas in fact strengthenedt. In the loose translation of cukupanas an "adequatesubsistence," the emphasis falls as much upon "subsistence" as upon nadequate."The vital importance of owning enough land to provide 1200 kilograms of milledrice equivalent per annum is that a peasant is thereby not dependent uponthe market to gain a livelihood. While he may participate in the market economyas a means of supplementing his income by the exchange of surplus production,this participation is at his own discretion. The market is his vent for thesurplus, which is his cushion against hard times. Those who do not have enoughland to provide an adequate subsistence, however, are forced to participatein the market economy. They may exchange superior foods such as rice, fruit,eggs, or chickens for inferior carbohydrates such as maize or cassava; theymay engage in less productive income-earning activities, such as foragingfor grass or firewood or making coconut sugar; they may become wage laborersor migrate to the cities. In colonial times taxes were imposed upon the ruralpopulation to create an artificial scarcity that would compel the releasefor the market of land and labor and their produce. The experience of therural Javanese has therefore inclined them to view the market with grave suspicionand to see their participation not as a means to greater prosperity but asboth consequence and cause of their poverty. As Penny and Singarimbun haveshown by cross-sectional analysis of one Javanese village, participation inthe market economy is greatest for farmers with little or no land, or forfarmers who have more than enough land to be cukupan. Those who have justenough land to be self-sufficient try to remain independent of the market.l

While the standard of cukupan has not been inflated by rising expectations,neither has it been eroded by worseningpoverty. In the 1960s, when food14. Penny and Singarimbun, Population and Poverty, p. 3. This may, however,be becoming less true. Since the late 1970s a "revolution of rising expectations"does seem to have reached village Java.15. Ibid. See also David H. Penny and M. Ginting, "House Gardens: A LastResort?" in Indonesia: Dualism, Growth and Poverty, ed. Ross Garnaut and PeterMcCawley (Canberra: Australian National University, 1980), esp. pp. 492-93.This also may be becoming less true. (See note 14 above.)



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79crop yields stagnated in the face of a faster than 2 percent annual increasein population,there was rural povertyunprecedented ut for the harsh interludeof the Japanese occupation. Napitupulu coined the term "invisible hunger"to describe the malnutritionwhich had becomechronicin much of rural Java. 6Based on fieldwork carried out in 1969, Penny and Singarimbun documented thestark reality of poverty at the village level. i7 Yet, while poor villagerscut to the bone the real income upon which they could survive, they appearnot to have compromised their ideal of what constituted an adequate subsistence.The tenacity of the ideal attests that it is rooted in a concept of equitywhich is historicallybased. It is a standardwhichthe commonpeople regardas having obtained in former times and one to which legitimately they canstill aspire.On its own, however, an adequate subsistence is only half a concept. Itslogical complements economic urplus, the balance of output after basic needshave been satisfied. s The nature and origins of economicsurplus can best beunderstoodbycomparison etween the productivityf agricultureon the frontierand in the heartland. The frontier is defined by two main characteristics.First, there is a large supply of uncultivated land. Second, no supravillagegovernment as effectiveauthority o impose significant axes upon the output.These conditionsapplied in parts of Java untilwell into the nineteenth entury,and still apply today in manyparts of the Outer Islands. Penny has shownthat under such conditionsJavanese peasants took up only so muchland asrequired to produce little more than an adequate subsistence (1200 kg/mre)."9Without buffalo or irrigation and using unimproved eeds without fertilizeron rainfed fields, the amount of land required is 0.7 hectares of ricefieldand 0.3 hectares of house garden to produce 900 kg and 300 kg respectivelyof milled rice equivalent. This also happens to be about the maximum reawhicha family an cultivate using only hand tools. Under these circumstancespeasants produce an adequate subsistence for themselvesbut no more. Exceptperhapsforvillage taxes, there is no economic urplus.In the heartlandof Mataram,however,Moertonohas stated that the rulerlevied tax on the rice harvest at a nominalrate of 40 percent. ? Even allowingthat the effectiverate was probablymuch ess than 40 percent, it would stillappear at first sight that the land tax, not to mention the corvee and variousother requisitions,must have cut heavily nto the real incomeof the peasantry.The crucial differencebetween the frontier and the heartland, however,was16. Napitupulu,"Hunger in Indonesia," Bulletin of Indonesian EconomicStudies9 (February 968).17. Pennyand Singarimbun,opulationand Poverty.18. The concept of economicsurplus was developed by Baran in the Marxisttraditionto refer to the differencebetween potential production nd essentialconsumption.See Paul Baran, The Political Economy fGrowthLondon:Penguin,1973).19. David H. Penny, "The Transition from Subsistence to Commercial FamilyFarming n NorthSumatra" PhD dissertation,Cornell University, 964).20. Moertono, tate and Statecraft, p. 14. See also Appendix .21. A. van derKraan,Conquest,Colonialism ndUnderdevelopment,SAAMonograph(Singapore: Heinemann,1980) includes a fascinating study of precolonial andcolonial tax systemson the island of Lombokwhich shows that, beforecolonialrule, actual rates of land tax were much ower than nominalrates.



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80that in the latter irrigation and the use of buffaloes more than doubled theoutput of wet rice agriculture--although he output of house gardens seemsto have remainedunchanged. In the heartland, a peasant family using bestpractice premoderntechnology, ncludingdouble-cropping, ould produce morethan 2000kilogramsof milled rice equivalent per hectare per annum.= Ratherthan being at the expense of the adequate subsistence of the peasantry, theland tax therefore seems to have represented, more or less, the additionalproduction resulting from the provision of irrigation. In other words, thegrowth n output broughtabout by state interventiondoes not seem to haveimproved he material well being of village society so much as providingthemeansfor the aggrandizement f the state."With regard to the distribution of economic surplus, Ben Anderson andHarold Crouch have both argued that traditional Java fits the Weberian modelof the patrimonial tate. r Unlike the situation in the West,where the holdersof political power are now expected to derive no greater benefit fromofficethan their salary and perquisites, in patrimonial societies a position takesthe form of a benefice. The holder is expected to extract personal incometo maintain a level of consumption consistent with his status, reflectingin turn his proximityo the source of power. At the same time,he is expectedto be generous in gifts to his patron and to distribute argesse amonghis ownclients. No stigma attaches to luxury onsumptions such. Nor was there anyresponsibilityto save or invest. The main danger lay in living above one'sstation, with the consequences attendant upon those guilty of IB'esemajestd.In the often intrigue-riddenourts of traditionalJava, this could be a matterof fine judgment. The distribution of economicsurplus was therefore both ameans of confirminghe status hierarchy nd a formof competitionwithin t.Far from being regarded as inequitable, inequality was the very essence ofthe system.

So far the argument has been that in traditional Java the peasantry heldto an ideal of an adequate subsistence, and that this absolute standard definedthe most that might legitimately be extracted from their output as economicsurplus. It remains to consider whether this was a right recognized by rulersand one which was actually enjoyed. Although Scott defines subsistence narrowlyin terms only of physical needs, he nevertheless puts the case very succinctly:

The operating assumption of the "right to subsistence" is that allmembers of the community have a presumptive right to a living so faras village resources will allow. This subsistence claim is morallybased on the common notion of a hierarchy of human needs, with themeans for physical survival naturally taking priority over all other22. Penny, "Some Aspects of the Problem of Overpopulation," and Booth, Accom-modating a Growing Population.23. This conclusion is reminiscent of Wittfogel's thesis of China's "hydraulicsociety." What needs to be determined, however, is the extent to which irrigationwas attributable to state rather than village initiative and resources. Inthe case of Java see N. C. van Setten van der Meer,Sawah Cultivation n AncientJava (Canberra: Australian National University ress, 1979).24. Benedict Anderson, "The Idea of Power in Javanese Culture," in Cultureand Politics in Indonesia, ed. Claire Holt et al. (Ithaca: Cornell UniversityPress, 1972),and Harold Crouch,"Patrimonialism nd MilitaryRule in Indonesia,"World Politics 31, 4 (July 1979).



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81claims to village wealth. . . . This right is surely the minimalclaim that an individualmakes on his society and it is perhapsforthis reason that it has suchmoral force.,In the case of Java, at least, Andersonwoulddisagree:Traditional thoughtclearly did not allow for any formof socialcontract or conceptualized system of mutual obligations. . . . Anysuchsystemwould have had to admit a formalreciprocityn politicalrelationshipsfundamentallylien to Javanese thinking.This verystrongstatement s later somewhat ualified:It would nonetheless be a mistake to infer . . . that there is noinherent sense of obligation and responsibility n the traditionalJavanese world-view. But this sense of obligation was and is anobligation to Power itself . . . to suppose that the behaviorrequired of the ruler is predicated on the stated or unstatedneeds of his subjects would be an error. The ruler must behaveproperlyor his Power will ebb and vanish, and with it the goodordering and smoothness of the social system. 6While n strictlyformal erms hismaybe true, the interpretation s neverthelessbased upon a theoretical rather than a practical rulingclass view of polities.Scott's general observations re again pertinent:S.. in all but the most coercive systemsof rural class relation-ships, there is some pattern of reciprocity, ome patternof rights,which peasants claim as the duty of those who control scarceresources. Such normative traditions are reflected in popularconceptions of what constitutes the "good" lord, the just king,the decent landlord.',Moertono would seem to confirm hat undernormalcircumstances he relations

between rulers and ruled in Java were hardlymore coercive than elsewhere.In Java, as elsewhere, an adequate subsistence seems to have been seenas one of three basic rights. The other two were peace and order,and justice. 2*To talk of these as "rights" s not, ofcourse, to imply hat theywere necessarilyenjoyed. No doubtthe contrarywas often the case. SunanAmangkurat (1646-77)is notoriousfor his loftydisavowal of concern for the welfare of his subjects. oHe was not, however, regarded as a model Javanese ruler. Peace, justice,and an adequate subsistence were rights in the sense that the common people25. Scott, Moral Economy,pp. 176-77.26. Anderson, "Idea of Power," pp. 47, 52.27. Scott, Moral Economy,p. 181.28. Moertono, State and Statecraft, ch. 2, esp. pp. 25-26.29. Justice (keadilan) might be defined as the right for grievances to beheard and dealt with wisely. The commonpeople had access to two institutions,that of nggogol (procession) and that of pepe (sitting in the sun in the squarebefore the palace). See ibid., p. 76.30. See D. H. Burger, Structural Changes in Javanese Society: The Supra-VillageSphere (Ithaca: Cornell Modern Indonesia Project, 1956), p. 8.



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82felt entitled to expect them of a wise and powerfulruler. ' If those rightswere notrespectedthe people had the optionto flee or, in the ultimateextremity,to rebel against unbearable oppression. The former,more in the nature ofan individual act, was obviously very common nd has been widely reported.As the Dutch found after 1830 in the administration f the Cultivation System,when the burdenbecame too heavy, the people melted away. As long as therestill existed in Java good uncultivated land more or less beyond the reachof rulers and taxation, there was some cheek upon the degree of exploitation.Without irrigation or water buffalo families could, as already explained,still obtain an adequate subsistence from and hacked out of the jungle.The ideal of an adequate subsistence was therefore still accessible, at leastfor the enterprising.Peasant revolts were nevertheless a recurrentphenomenon. As Sartonohas argued,The sporadic agrarian uprisings of the past two centuries, all,whatever their stated objectives, expressed a fundamentalprotest

against the existingconditions n rural life.*2He also argues that there is no reason to believe that revoltshave been confinedto the colonial era forwhich records are avaiable. One mightexpect, however,that revolts would have become more frequentas the nineteenthcenturyworeon, for reasons other than the trauma of colonial rule. Unoccupied and becamemore scarce and the authority f the colonial governmentxtendedrelentlessly.By the end of the century he frontierwas rapidlydisappearing. Land holdingsfragmented nd output per capita began to fall, while the efficiency f taxcollection improved.s" As the ideal of an adequate subsistence receded fromgrasp, at least in moredensely populated areas, it would have been surprisingif the appeal of messianic eaders had not increased.The problem,which eemsto have becomemorewidespread uring he nineteenthcentury, is, therefore,not that the Javanese and colonial governments axedaway the economicsurplus, but that they taxed away more than the economicsurplus. In terms of "moral economy,"the marginbetween the actual levelof peasant consumption nd the level which would have providedan adequatesubsistence was not legitimately part of the economic surplus. Extensionof the tax base, mainly throughmore "efficient"administration, o includea part of subsistence income was facilitated by the changingbalance of powerbetween rulers and ruled. The peasantry lost their formerly e facto vetopowerover the distribution f income, nd the leverage of thecolonial governmentgreatly ncreased. As economic urplus per capita produced ywet-riceagriculturedeclined, the state was better able to defend its claims to the output thanthe peasantrywere able to defendtheir rightto an adequate subsistence,31. Wayangwould seem to have played an importantpart in legitimizingandreinforcinghose rights.32. Sartono Kartodirdjo,"AgrarianRadicalism n Java," in Culture and Politics,p. 72.33. Van der Kraan, Conquest, Colonialism, gives a clear picture of how thisprocess occurred n Lombok.34. As Scott (Moral Economy,p. 7) aptly remarks: "The essential questionis who stabilizes his incomeat whose expense."



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83The Ethical Policy (1901-42) a

Although Dutch colonial rule has been widely condemned as a period ofoppression and exploitation, in some important respects the Dutch seem tohave acted very much like a traditional Javanese government. Indeed, after1900 Dutch rule seems, by traditional Javanese standards, to have been quiteenlightened. In particular, there was a systematic attempt to uphold thepeople's basic rights of peace, justice, and an adequate subsistence. Colonialrule remained, of course, fundamentally exploitive. The aim of the EthicalPolicy--orWelfare Policy as it later became known--wasnot to transform hesocial order but to preserve it. But traditional Javanese governmentwasalso exploitive. The commonpeople expected nothing else. For enlightenedexploitationtheycould be grateful.Peace and order (rust en orde) was undoubtedly he main benefit whichthe people of Java received from he final centuryof colonial rule. PrecolonialJava was not a peaceful place, and Schrieke has vividlydescribed the destructionwrought by traditional warfare. As Ricklefs has convincingly rgued, theDutch presence in Java was initially destabilizing and probablymade internecinewarfare more frequent. The bitter Java War of 1825-30 could be attributeddirectly to colonial policy." After 1830, however,the Pax Neerlandica lastedfor more than a century,probablythe longest period of continuouspeace everknown. This peace was certainly not enforced for the benefit of the people,but they did benefit nonetheless. Perhaps the best reflection of this wasthe steady growth in population, although in the long run this was to be amixedblessing.Withregard to justice, heroic effortswere made to codifyadat (customary)law as a legal systemfor the common eople.,, In the end it turnedout tobe a blind alley. Because of the stigma that adat law applied to the "natives"as second-class citizens while the colonial elite enjoyed the privileges ofWesternlaw, the maintenance of separate legal systemsfor rulers and ruleddid not formally survive independence. Deprived of the formal protectionof codified adat law but still withoutproperaccess to Western aw, the commonpeople have therebybeen left to the benevolence of arbitrary uthority.The mainspringf the Ethical Policywas concernwith the diminishing elfare(mindere welvaart) of the Javanese people. The "debt of honor" was, in effect,35. Although much has been written on the Ethical Policy, the literaturehas been biased towards its polities rather than its economies. Notable exceptionsare John S. Furnivall, Netherlands Indies: A Study of Plural Economy (Cambridge:Cambridge University Press, 1939), A. Jonkers, Het Welvaartzorg in Indonesie(The Hague: van Hoeve, 1948), and P. Creutzberg, ed., Het Ekonomisch Beleidin Nederlandsch-lndie, 4 vols. (Groningen: Wolters & Noordhoff, 1971-75).This last is a mine of source material.36. B. Schrieke, Ruler and Realm in Early Java: Indonesian Sociological Studies,Part II (The Hague: van Hoeve, 1959), esp. pp. 143-52; Merle C. Ricklefs,Jogjakarta under Sultan Mangkubumi, 1747-1792 (London: Oxford University Press,1974); and P. B. R. Carey, ed. and trans., Babad Dipanegara. An Account ofthe Outbreak of the Java War (1825-30) (Kuala Lumpur: Art Printers, 1981).37. These efforts are identified with the "Leiden School" and the work ofVan Vollenhoven n particular.



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84to restore to the people the means to an adequate subsistence. Many ofthe measures taken would have met with the approvalofany enlightenedJavaneseruler. Irrigation and resettlement transmigration)were sound physiocraticpolicies. The Dutch devoted more attention to roads, railways, telegraphs,and post offices,but the strategic advantages to be gained fromgood communi-cations were at least understood n precolonial Java. Unfortunately,lthoughthese measures must have slowed down the decline in living standards, theywere not sufficientgenerally to restore an adequate subsistence. Had suchmeasures been implemented centuryearlier when population pressure on theland was less acute, theywould no doubt have yielded more favorable results.It was not altogether the fault of the Dutch that Java "filled up" duringthe course of the nineteenthcentury,even though the Pax Neerlandica hadallowed the population to growmore steadily than would otherwise have beenthe case."

Despite a similarityof means, however, in conception the Ethical Policywas fundamentally ifferent rom modernDevelopmentPolicy. There was noobjective of a sustained long-term mprovementn living standards. As statedabove, the main goal was the more modest one of restoringto the peasantrythe means to an adequate subsistence. Proclamation of the Ethical Policyamounted to acknowledgmenthat an adequate subsistence was a basic right.The Dutch did not forgo their claim to the economicsurplus, but implicitlyrecognizedthat theyhad expropriatedmore than the economic urplusand therebyinfringed this right of subsistence. The more telling criticismthat canbe made of the Ethical Policy is not that the Dutch were half-hearted n theirefforts to raise agricultural productivity ut that they balked at any radicallighteningof the tax burdenon the people. Anne Booth has shownfor theperiod 1926-39 that, excluding subsistence consumption from the tax base andallowingfor some progressivity, he tax burdenupon the indigenouspopulationwas consistently higher than upon the non-Indonesian opulation.4o Moreover,duringthe Depressionof the 1930s,the tax burden ponthe indigenouspopulationincreased sharply and disproportionately. This criticismmerely confirms,however,that the Ethical Policy presupposeda basic social distinction betweenrulers and ruled. Notwithstandinghe liberal originsof the Policy, it reflecteda colonial view of equity which coincided remarkably losely with that of38. The data are not available to establish whether there was in fact a steadydecline in the level of welfare in the latter part of the nineteenthcentury.The Ethical Policy was, however,based on this premise,and the commission fenquirywhichproduceda series of reports between1904 and 1914 was known sthe Mindere Welvaart Commissie. Summarizing the results of this enquiry in 1914,Hasselman concludedthat the level of welfare had declined in someareas of Javabut that this was not a general phenomenon. See C. J. Hasselman, "General Surveyof the Results of the Investigation nto Economic rosperitynJava and Madura,"in Indonesia: Selected Documents on Colonialism and Nationalism, 1830-1941,ed. C. Penders (St. Lucia: Queensland UniversityPress, 1977). The term "debtof honor" was coined by C. T. van Deventer in his famous article, "Een Eereschuld"(1899).39. See P. McDonald, "A Historical Perspective to Population Growth in Indonesia,"Indonesia: The Making of a Culture, ed. J. J. Fox (Canberra: Australian NationalUniversity, 1980), esp. pp. 84-88.40. Anne Booth, "The Burden of Taxation in Colonial Indonesia in the TwentiethCentury," Journal of Southeast Asian Studies 11, 1 (March 1980).



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85traditional Java. To assess the Ethical Policy as a Development Policy isonlyto showthat it was not what it was not.Education, however,was one critical aspect in which the Ethical Policywasaltogether untraditional. In the more recent periodwith whichwe are familiar,Javanese rulers never displayedmuch oncern for the formal education of theirsubjects. Neither for manyyears did the colonial government. At the end ofthe nineteenthcentury,access to Western education was still confinedfor themostpart to the sons of regents,while vernaeulareducation was rudimentary.The significanceof educational reformsunder the Ethical Policy was twofold.First, the government ccepted responsibilityfor "native" education in theform of the desa (village) school. Progress towards mass primary ducationwas neverthelessveryslow. 2 Second, childrenof well-to-do Indonesianparentswere allowed access to Dutch secondary education, with the opportunityofproceeding to professionally oriented tertiary education in such fields asmedicine, aw, and engineering. The aim was to produce a small WesternizedIndonesian elite whose members ould fill responsible positions in the rapidlygrowing ivil service. This enlightenedpolicyrebounded n the Dutch. Contactwith Western liberal values made these privileged Indonesians more aware ofthe discrepancybetween Dutch rule in the Netherlands and Dutch rule in theEast Indies. At the same time, their limited career prospects highlightedthe fact that they were still second-elass eitizens in their own country.Their frustration became one of the wellsprings of the modernnationalistmovement.Independence and Guided Democracy

Independence brought about a radical shift in values as the nascent Indonesianmiddle class displaced the colonial Dutch as holders of political power.As a result of the education policy of the late colonial era, most of theleaders of this nationalist revolution were in the Western liberal tradition.No one has put it moreforcefully han J. M. van der Kroef in the early yearsof independence:The educated elite of commoners who shaped the Indonesian Revolutionand are now at the helm of the state are children of the FrenchRevolution and of nineteenth century Liberalism. They, like theirprotagonists of 1789, directed their efforts towards the abolitionof privilege, an end to the restrictions that hampered the full

41. The first Javanese schools dated from 1848 and were set up to train childrenof noble families as scribes and administrators. About the same time schoolswere set up to train teachers and vaccinators (dokter djawa). See Van Niel,Modern Indonesian Elite, pp. 26-30.42. Ibid., pp. 68-70.43. Heather Sutherland, The Making of a Bureaucratic Elite, ASAA Monograph(Singapore: Heinemann, 1979), points out that an early decision was made toexclude Indonesians from the civil service proper (Binnenlands Bestuur).Van Niel, Modern Indonesian Elite (esp. pp. 180-81) refers to the decisionnot to pay Indonesians the same remuneration as Europeans in services suchas education, credit, and irrigation where they worked side by side. JohnIngleson, The Road to Exile: The Indonesian Nationalist Movement, 927-1936,ASAA Monograph (Singapore: Heinemann, 1979) is a good account of the earlynationalistmovement.



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86use of their economic resources, the overthrow of a politicalsystem which left them outside the legislative process in theirown country and the removal of the social inequality and inhumanexploitation on which the colonial ancien regime rested.44

It was no coincidence that the government of an independent Indonesia wasrepublican and democratic. In the economic sphere, however, where the Dutchretained their supremacy, liberalism was discredited in favor of socialism.Lance Castles has nicely described the circumstances which gave rise to thissituation:[I]t was from the small circle of the Western-educated, generallyspringing from the aristocratic and official class, that the leadershipof the national movementand the elite of the new state were mainlydrawn. In this group an aristocratic contempt for commercial andindustrial occupations combined with an intellectual attraction toMarxism to form a strongly anti-capitalist ideology, but one whosepositive content differed a good deal fromone individual to another.As the commanding heights of the Netherlands Indies economywerealready occupied by European capital, nationalist sentiment coincidedwith socialist in demanding their nationalisation. . . . As employees(or potential employees and office-holders) of the state, theelite had every reason to favour the maximisation of its economicrole. 4The essence of Sukarno's Marhaenist ideology was that the elite formed a singleclass with the peasants and workers. In terms of ownership of the means ofproduction, there was no national bourgeoisie. Concern for the welfare ofthe common people was expressed in the principle of social justice, meaningeconomic equality, which was enshrined in the Panca Sila (Five Principles)and written into the Constitution.4*

The abandonment of parliamentary democracy in favor of "Guided Democracy"and "Guided Economy" was meant to provide the conditions for realizing thesocialist goals of the revolution. In practice, "Socialism 'a la Indonesia"involvedprimary mphasis upon state ownershipand control. Once Dutch enterpriseshad been nationalized, however, much of the momentumwas lost. The bureaucracygrew until it was quite bloated, but the socialist consensus did not extendasfar as effectivemeasures to raise the level of welfare of the people. Underthe slogan of sandang-pangan food and clothing)an attemptwas made throughofficially sponsored cooperatives and rationing to achieve some equality inthe distribution f basic commodities,n accordance with the Panca Sila principleof social justice.47 Because of widespread corruptionand the failure ofthe cooperatives, however,distributionwas implemented nlyfor civil servants,thereby helping to turn the civil service into a vast relief organization.44. Quoted in GunnarMyrdal,Asian Drama (New York: TwentiethCenturyFund,1966), pp. 750-51.45. Lance Castles, "The Fate of the Private Entrepreneur," in Sukarno's GuidedIndonesia, ed. T. K. Tan (Brisbane: Jacaranda Press, 1967), p. 74.46. See Sukarno, "The Pantja Sila" in Indonesian Political Thinking1945-1965ed. Herbert Feith and Lance Castles (Ithaca: Cornell UniversityPress, 1970),pp. 40-49.47. See T. K. Tan, "SukarnianEconomics"n Sukarno'sGuided ndonesia, pp. 29-45.



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87In theorythe people were also meant to benefit from the nationalization offoreign enterprises, throughthe provisionof public sector goods and servicesat heavily subsidized prices. The impact of subsidies on the budget was sogreat, however, that this attempt to reconcile state ownershipwith popularwelfarewas economically isastrous. The resultanthuge budgetdeficitsgeneratedhyperinflation,which had a highlyregressive distributional impact, at leastin urban areas.*4 Anyone with liquid capital and political connections waswell placed to make large profits through oncessions and speculation--Castlesreferredto the wrydistinctionbetween the newlyrich (orang kaya baru) andthe suddenlyrich (orang kaya mendadak).49 Those on fixedmoney ncomeswereeconomically nnihilated. Even manycivil servants faced a struggle to surviveas the real value of their salaries and supplementsfell more and more belowthe cost of living. Smallholderexporters, mainly n the Outer Islands, wereheavily penalized by the multiple exchange rate regime. Ironically, however,the real income of food producersmayhave risen, not because of any socialistmeasures but because theywere able to disengage themselvesfromthe marketeconomy.

AlthoughSukarno saw himselfas the symbolof national unity, the briefera of Guided Democracy hattered the social consensus that had more or lessheld since independence. The rhetoricwas socialist but the realitywas worseninginequality. At the same time, Sukarno's patronage of the Communistparty(PKI) provided a hitherto unparalleled opportunityfor radical mobilizationof the landless peasantry.* By the mid-1960s here was the real possibilitythat the demiseof Sukarnowouldallow the PKI to gain controlof the governmentwiththe supportof the firstwidespreadpeasant movementn Indonesianhistory.This would have been the ultimatevindication f Sukarno's deal of the continuingrevolution, lbeit notone that he seemsto havecontemplatedwith nyenthusiasm.The New Order

While the events of September30/October , 1965maybe described in termsof their outcome as a militarycoup, the establishmentof the New Order isperhaps better understood as a middle-class counterrevolution. Indisputably,the PKI and the rural poor were the losers. To what extent the latter wouldultimatelyhave benefitedfroma Communist arty victoryis perhaps an openquestion, but the failure of the PKI's bid for power and its bloodyextirpationremoved ll possibilityof an organizedpeasant revolutionwithinthe foreseeablefuture. The ArmedForces were the obvious victors, since their already greatde facto authoritywas formalizedby martial law. Somewhat less obviously,an emergingmiddle lass was also to be counted mong hewinners. Notwithstandingthe phenomenalgrowth n the size of the bureaucracyunder GuidedDemocracy,its members ad for the mostpart suffered markeddecline in livingstandards,48. The best study of the nature, causes, and effects of the inflation isJ. A. C. Mackie, Problems of the Indonesian Inflation (Ithaca: Cornell ModernIndonesia Project, 1967).49. Castles, "Fate of the Private Entrepreneur," p. 78.50. Rex Mortimer, "Strategies of Rural Development in Indonesia: PeasantMobilisationversus Technological Stimulation," n Stubborn urvivors:DissentingEssays on Peasants and ThirdWorldDevelopmentby Rex Mortimer, d. HerbertFeith and R. Tiffen (Melbourne: Centre of Southeast Asian Studies, MonashUniversity,984).



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88and their privileges had been further threatened by the power of the PKI.It is no paradox that the students, who in 1966 spearheaded the movement whichforced Sukarno to abdicate, were absorbed so easily into the New Order. In1966 they were not only the conscience of the emerging middle class but alsohad a strong vested interest in a system of privilege for those with education.Robison, however, offers a very different interpretation:Before 1959, and even up to 1965, the intellectuals were to alarge degree integrated in the power structure through the agencyof the mass parties. After 1965, when hegemony was seized bythe military, intellectuals ceased to play roles as politiciansand were offered only those of technocrats and advisers. . . . Suchroles offer little that is attractive to people proud of theirtechnological,administrativend managerialcompetence,.Yet this seems to be doubly wrong. First, if one talks of a middle classrather than just intellectuals--and Robison himself defines the intellectualsas a class with civil servants and students--then he mass parties of the OldOrder, despite their largely middle-class leadership, posed a serious radicalthreat to middle-class aspirations. Second, it is hardly self-evident thatthose "proudof their technological,administrative nd managerialcompetence"would be dissatisfied with the roles of technocratand adviser as opposed tothe impotenceof all but a few politicians under the Old Order. Rather thandismissing he inclusionof the technocrats n NewOrdercabinets as mere windowdressing, it seems more helpfulto see their role as the logical outcomeof thecoalition formed n 1966 between the ArmedForces and middle-class lements,.SThe economicgoals of the New Order, stability and development--meaningnpractice economic growth--also reflected this coalition. Socialism was allbutdisowned.Under the New Orderthe material aspirations of the middle lass have beenachieved beyondthe wildest dreamsof those who took to the streets in the lastfew days of the old regime. The rate of inflation was reduced from bout 600percent in 1965-66 to 10 percent in 1969.* Due largely to the booming oilsector, which accounted for the major proportionof both the value of exportsand of central government evenues,between1970 nd 1980 he economymaintaineda remarkable verage growth ate of about8 percent n real terms. Evenallowingfor a populationgrowthrate of about 2 percent, this has meant an impressiverise in real income per capita. The benefits have flowed disproportionatelyto the relatively small urban middle-class elite. Between 1960 and 1976 realexpenditure per capita increased twice as rapidly in urban (40 percent) asin rural (20 percent) Java, and faster in Jakarta (50 percent) than in anyothercity. Moreover, he increase of 40 percent n urbanper capita expenditureswas biased heavilytowardthe upper expenditure uintiles, '51. Richard Robison, "Towards a Class Analysis of the Indonesian MilitaryBureaucratic State," Indonesia 25 (April 1979): 39.52. This is not to deny, of course, that middle-class intellectuals belongedto the PKI and PNI and wereamong hevictimswhenthese partiesweresuppressed.There was certainlyno monolithicmiddle lass.53. S. A. Grenville, "MonetaryPolicy and the Formal Financial Sector," inGarnaut and McCawley, Indonesia: Dualism, p. 108.54. See R. M. Sundrum nd Anne Booth, "Income Distribution in Indonesia:Trendsand Determinants,"n ibid.



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89Observation confirms the pattern suggested by the expenditure data. Thenumber of motor vehicles available for personal use--whether privately orgovernment owned--has soared, and the number of motorcycles has increasedeven more dramatically. Middle-class youths are now ashamed to ride a bicycle.

Those, who at the beginning of the New Order would already have been countedas part of the middle class, have been able to extend their homes or moveinto modernnew housingcomplexes. The modestfurnishings f the late 1960shave given way to muchgreater luxury,and the range of typical householdappliances has increased to include television, stereo sets, air conditioners,refrigerators, nd rice cookers--and now videocassette recorders. One noticesa fashion for collecting rare birds and fish. Other signs of middle-classprosperity re the proliferationof hair salons (for both sexes), the preferencefor expensive hand-painted batik clothing, the wearing of imported uxurywatches, and the greater frequencyof overseas travel. In view of the readyavailability of servants, manymiddle-classfamilies, let alone those belongingto the militaryelite, are now able to enjoy a standard of living which wouldbe regardedas luxuriousbyWesternmiddle-class tandards.This consumerrevolution has involveda good deal of superficialWesterni-zation, sometimesreferred o as the spread of "Coca-Cola culture." The press,radio, films, and, more recently, television, have been powerful influences.Being seen to be moderen,however,has been an important spect of the cultureof the Indonesian elite since the late colonial period. In the mestizo colonialculture that prevailed until the mid-nineteenth entury, the largely maleEuropeancommunityendedto emulate the lifestylesof the Javanese aristocracy.Withthe openingup of Java to private capital and the consolidationof a moreEuropean middle-class society in the late nineteenth century, a model wasset for the lifestyle of the Indonesian middle class which emergedwith theliberalization of secondary and tertiary education. After independence andthe expulsion of Dutch nationals in 1958, middle-class Indonesians simplytook their place, occupyingtheir homes and taking over their less portablepossessions. Under the New Order there have been wideningopportunitiesformiddle-class Indonesians to mix professionallyand socially with middle-classWesterners, oth within and outside the country. This has been reflected n thesustained demand for English-languageconversation courses. Some convergenceof Indonesian middle-class lifestyles with those of the West is thereforehardly urprising.AlthoughWestern onsumerpreferenceshave been absorbed moreeasily thanWesternmiddle-classvalues, in the latter ease there would also seem to besome convergence. First, the Indonesian middle class has come to accept boththe desirability and the possibility of steadily rising living standards. Thecommitment o developmentas a national priority in the early days of theNew Order was a conscious break with the traditionallystatic perception of

the economywhichhad been pervasivein the periodof GuidedDemocracy. Second,far frombeing accepted as part of the natural order of society, inequalityis increasinglybeing viewed as undesirable per se, as seen in the inclusionof "equality" (pemerataan) amongthe goals, howevervague, of the Third FiveYear Plan (1979-84). , Third, the middle class does not subscribe to the55. Repelita III specified eight paths to equality (jalur pemerataan) namely:1. Equality in fulfilling people's basic needs, especially for food,clothing,and shelter.2. Equalityof opportunityn obtainingeducation and health services.



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90feudal idea that each man is born to his station in life, but rather aspiresto upward mobilityon the basis of education and experience. The notions ofmerit and career, which are quintessentiallymiddle class, are epitomized nthe bureaucracies of the civil service, armedforces, and business corporations.Whether the Indonesian middle class also displays the traditional Westernmiddle-class "virtues" of hard work and thrift is another question. Fourth,elements of the middle class are displaying a growingconcern with liberalideas of democracy, he rule of law, and freedomof speech, " They are alsomore and more nclinedto perceive corruption s a moral issue.The middle-class commitment o rising living standards, equality, socialmobility,nd democratic ightsdoes notmean, however, hat these are necessarilyto be enjoyed by all. Rather it seems that, as in George Orwell's familiarphrase, some are to be moreequal thanothers. The substanceof the middle-classcommitment o equality can best be understoodin relation to the slogan ofpolo kehidupan sederhana (modest lifestyles). It is officially regarded asextravagantto own more than one bungalow,to have more thanone car, and tomake frequent trips abroad. No one is to be condemned,however,for havingonlyone modern ungalowfitted out withsuch itemsas air conditioning, arpets,refrigerator,color television, and sound system,for having only one car andmotorcycles for the children, or for making occasional trips abroad. Theseare now the "basic needs" of the middleclass. It is trite to point out that,by contrast, few villagers or kampungdwellers have access to electricity,let alone being able to afford such expensive consumer durables. For manyit is still a struggle to eat properly all year round, to buy medicines ifthey fall sick, and to support their childrenthroughthe nominally ree stateeducation system. Yet the proposition has never seriously been put forwardthat genuine equality and implementation f pola kehidupansederhana shouldinvolve the urban middle class forgoingall but an adequate subsistence untilsuch time as all other Indonesians are as well off. The real target of theslogan would seem to be not the middle class but a small elite. In termsofmiddle-class values, the lavish conspicuous consumptionof high civil andmilitaryofficials, far frombeing legitimized--aswould traditionallyhave beenthe case--by proximity o the source of political power,is regardedas an abuse.This moral condemnation eems to be moreclosely allied to jealousy and envy,however,than to any genuineconcernfor the welfare of the common eople.The New Order governmenthas nevertheless taken measures to raise thelevel of popular welfare. First and foremost,there is the rice buffer tockand price stabilization scheme operated since the mid-1960sby Bulog (Badan

3. Equalityof incomedistribution.4. Equalityof employmentpportunities.5. Equalityof businessopportunities.6. Equality of opportunity to participate in development, especiallyfor the young generation and women.7. Equality in the spread of development throughout the whole country.8. Equal opportunity in obtaining justice.These are broad goals, however, without specific guidance as to how they areto be achieved.56. See especially Lev, "Origins of Indonesian Advocacy," p. 160, and alsoJ. A. C. Mackie, "Indonesia Since 1945--Problems of Interpretation," inInterpreting Indonesian Politics, ed. Benedict Anderson and AudreyKahin (Ithaca:Cornell Modern Indonesia Project, 1982), p. 129.



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91Urusan Logistik), the Logistics Affairs Agency.s This has very effectivelycushioned consumers against large price rises due to harvest failure. BecauseBulog's policies work through the market for rice, however, they do not providea means of supplementing the subsistence of people who are so poor that theylack the purchasing power to buy sufficient rice. Only very occasionally,in the case of localized outbreaks of severe famine, has rice been distributedon the basis of need. The same applies to policies to stabilize the pricesof other of the nine basic commodities (bahan pokok)--salted fish, cookingoil, sugar, salt, kerosene, soap, and low-grade textiles.*5 In the case ofkerosene there has been a very large subsidy, ' while in many cities therehas also been a considerable subsidy of public transport bus fares. Whileall of these subsidies have helped to reduce the cost of living, the distributionof benefits has been biased in two ways. First, the benefits have floweddisproportionately to those living in the large cities--there are good politicalreasons why the government should fear urban "rice riots." Second, becausethe amount of subsidyreceived is proportional to the amount of the good consumed,much of the benefit of consumer subsidies has flowed to the urban middle class.The urban middle class have also tended to be the primebeneficiaries of governmenthousing programs, which had been directed mainly towards the needs of civilservants and, perhaps to a lesser extent, of clinics set up under the familyplanning and health programs. Although the New Order governmentmightappearto be pursuing the elements of a "basic needs" strategy, overall there seemsto be little evidence of redistribution away fromthe urban middle class.One way of pursuing equality without any redistribution of wealth and incomeis to redefine equality in terms of equality of opportunity. The opportunity isfor the poor peasant or coolie to rise up into the middle class. The means tothat end is education, to which the New Order government has now given toppriority. In the 1982-83 development budget, education was the largest singleitem. This expenditure is directed toward ultimately achieving universal primaryeducation, as well as toward a big expansion in junior high school enrollments.In itself this is almost certainly a good thing. It does not follow, however,that the outcome will indeed be equality of opportunity. First, in the absenceof positive discrimination, poor parents cannot afford to support their childrenas dependents through six years of higher education, even if they could affordthe outlays for books, uniforms, and excursions, the unofficial entrance fees,and the variety of other legal and illegal levies. Second, it is the old fallacyofmisplaced ggregationto assumethat,because education allows some individualsto becomeupwardlymobile, it will thereforeallow a whole lower class to seizea very limited range of employment opportunities. Nevertheless, historicallyeducation has been the main channel of upward mobility, and income is stillhighly correlated with the level of education.,o The argument is thereforesufficiently plausible and the grounds for believing it so appealing, thatpeasant and working-classparents maywell aspire to middle-class materialismfor their children, rather than seek to overthrowmiddle-class rule for a57. See Leon A. Mears and Sidik Moeljono, "Food Policy," in The IndonesianEconomy during the Soeharto Era, ed. Anne Booth and Peter McCawley (London:Oxford University Press, 1981).58. These are basically the sandang-pangan commodities of the Sukarno period.59. See Howard Dick, "The Oil Price Subsidy, Deforestation and Equity," Bulletinof Indonesian Economic Studies 16, 3 (November 1980).60. See Sundrum and Booth, "Income Distribution in Indonesia."



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92socialist ideal of genuine equality. On the other hand, there is clear evidencethat the rate of open unemployments highlycorrelated with the level ofeducation, and the rate can be expected to worsen as educational opportunitieswiden. This problem has already given rise to political tensions in someother developing countries, most notably Sri Lanka. It would be ironic if,by the rapid developmentof education, the New Order were to sow the seedsof its own destruction t the hands of discontentedmiddle-classyouth.1Conclusion

The middle-class revolution that began in Indonesia in the 1920smay yetbe a victoryfor bourgeois democracy, ut this could be little cause forrejoicingon the part of the people. The post-independencehistoryof India--and,untilmartial law, of the Philippines--shows owunresponsive prosperousmiddle-classdemocracycan be to mass poverty.'1 Paradoxically, the smaller the threatof popular revolution,the morefavorable are the conditionsfor the emergenceof middle-class democracyfrommilitary rule, but the weaker the pressuresfor any significant redistributionof wealth and income at the expense ofthe middle class. Althougha growingconcernfor equality may be expressedmore and more in Westernmiddle-classterms, in practice the commonpeopleare unlikely to be the beneficiaries. Relative inequality can be expectedto increase as economicgrowth increases the size of the economic surplusdistributed among the middle class. Absolute povertycould also worsen ifan emergingrural elite of rich farmersand of absentee landlords were tointroduce moderncapital-intensive farmtechnology nd therebydisplace laborat a faster rate thancan be absorbed n manufacturing,onstruction, r services.In terms of developmentpolicy, there seems to be a great historical irony.Since the mid-1970s he Westernconcern with Third Worldpovertyhas at lastbeen translated into humanterms in the formof a "basic needs" strategyforeconomicdevelopment. In Indonesia this ought to correspondvery closely withthe traditional Javanese perceptionof an adequate subsistence (cukupan). Yetit has struck no resonant chord. The reason would seem to be that the middleclass now dominates articulate society, and government o longer acknowledgesa popular right to an adequate subsistence. A rhetoric of equality is beingtranslated into some effortsto ensure equality of opportunitynd to facilitateupward mobility,but "devil take the hindmost." No general improvementnpopular welfare is likely until growth has been sustained for long enoughto create a permanent hortage of unskilled rural labor and usher in an eraof risingreal wages.61. As argued above, it was probably the most enlightened element of theEthical Policy, namely the extension of Western iberal education to a smallIndonesian elite, that stimulated the nationalist movement nd hastened theend of colonial rule.62. Of course, the Emergency n India and Martial Law in the Philippinesdo not seem to have had anygreater impact uponmass poverty,notwithstandingall the rhetoric.