Monday, August 8, 2016

Cashing in - Jokowi’s second reshuffle is a win for the president’s loyalists and financiers

The notion that Jokowi is a truly reform-minded president, who is working to change the political ‘rules of the game’, is therefore no longer sustainable. Though his appointments may not reflect party loyalties, they are every bit as particularistic and politicised as those made by his predecessors in Indonesia’s highest office.

Political campaign financing in contemporary Indonesia is neither transparent nor accountable. State subsidisation of political parties is negligible, and candidates must typically accrue large private funds in order to remain competitive in increasingly slick and expensive electoral contests. The imperatives of campaign fundraising even apply to a popular incumbent president like Joko Widodo (Jokowi).

The past week has seen plenty of commentary on Jokowi’s second cabinet reshuffle, much of it focused on the appointment of the controversial retired general Wiranto as Coordinating Minister for Political, Legal and Security Affairs, and widespread changes to the government’s economic team.

However, an important element that has been overlooked relates to the consolidation of the president’s personal financial and political position in preparation for his re-election bid in 2019.

A small group of key donors, allies and fundraisers who sponsored Jokowi’s campaign in 2014 – notably Rini Soemarno, Luhut Panjaitan and Amran Sulaiman – remain entrenched in government, despite vociferous opposition from within the principal government party, indications of shady financial dealings, or the public airing of intra-cabinet grievances in the manner that saw fellow ministers Ignasius Jonan, Rizal Ramli and Sudirman Said sacked.

When he won Indonesia’s 2014 presidential election, Jokowi was widely perceived as a clean, moderate reformer. He came to power promising to implement an ambitious program of governmental and bureaucratic reorganisation, infrastructure development, economic growth, and improvement of the murky judicial system. He also vowed to avoid the transactional political practices often seen in Indonesia, which see the spoils of office distributed among the supporters and sponsors of a successful candidate.

These commitments seemed all the more plausible when compared to the demagogic populism of his rival, Prabowo Subianto. Upon taking office, the widespread concern among observers was that Jokowi could prove a weak president, whose intentions were laudable, but who would struggle to deal with entrenched oligarchic interests and the pressure of political parties.

Developments over the past year have forced a significant reassessment. Jokowi looks an increasingly empowered president. Far from being a puppet of parties, he has been willing to interfere in their internal democratic processes in order to bring them to heel. While his governing coalition now comprises an overwhelming majority in parliament – reminiscent of Susilo Bambang Yudhoyono’s ‘rainbow’ cabinets – it is hard to read this as the resurrection of an all-powerful party cartel.

If we accept that Jokowi has embraced the politics of horse-trading, he certainly scored a bargain in winning the full backing of parties like Golkar, the National Mandate Party (PAN) and the United Development Party (PPP) by giving them just once ministry apiece – and not central ministries at that.

Indeed, the most secure and influential members of cabinet are those who owe their positions to the president’s patronage, rather than the support of party bosses. This is especially true of those individuals capable of providing the president with his own network of political and financial support.

Despite securing the support of seven out of 10 parliamentary parties, Jokowi remains a president without a party of his own. While nominally a member of the Indonesian Democratic Party of Struggle (PDIP), his relationship with its chairperson, Megawati Sukarnoputri, has been strained.

In particular, Megawati has taken umbrage at Jokowi’s refusal to sack Rini, and his reluctance to promote Megawati’s former aide, the police general Budi Gunawan, to a position of greater strategic influence.

Moreover, for much of the 2014 campaign PDIP failed to provide Jokowi with effective material support. Indeed, funds were apparently withheld by Megawati’s daughter and Jokowi’s official campaign manager, Puan Maharani.

Rather than tying his fortunes to political parties in which he has justifiably little faith, Jokowi has sought to consolidate his position with the support of individuals like Rini, Luhut, and Amran. During the 2014 campaign, Rini collected millions of dollars in donations through her political and corporate networks, and was able to cover the vast cost of paying presidential election monitors at more than 540,000 polling stations across the country. A one-time Megawati confidant, Rini fell out with the PDIP chairperson when, as head of Jokowi’s ‘Transition Team’, she openly opposed Megawati’s efforts to dictate cabinet appointments in his new government.

As Minister for State-Owned Enterprises (SOEs), Rini has distributed directorships to a number of the president’s influential supporters, while offering negligible representation to PDIP cadres. Although Rini has faced immense pressure from PDIP, not to mention vocal criticism from numerous party politicians and fellow ministers, Jokowi clearly considers her a valuable ally and has risked further deterioration in the relationship with his primary party to retain her in cabinet.

Amran Sulaiman – the wealthiest cabinet minister – was a key financier of the pro-Jokowi ‘volunteer’ movement in 2014, particularly on his home island of Sulawesi. A well-connected stakeholder in the agribusiness sector, Amran is rumoured to have previously bought substantial concessions from the Agriculture Ministry he now oversees.

Despite little obvious achievement in his portfolio, Amran’s loyalty to the president and his ability to mobilise cash and support have ensured his place in government remains secure. Amran’s case can be contrasted with that of sacked Education Minister Anies Baswedan. Anies, a highly-regarded, non-partisan educator who was a prominent member of Jokowi’s campaign team in 2014, lacks the wealth or political influence to offer significant material support and has been unceremoniously dumped.

Luhut, Jokowi’s business partner of more than a decade, also spent heavily during the presidential campaign, and has been Jokowi’s most trusted firefighter over the last two years. After his appointment to a coordinating ministry was blocked by PDIP in 2014, Luhut was tasked with heading up a revamped Presidential Staff – a position which gave him significant policy influence in the early months of the Jokowi presidency.

When he was appointed Coordinating Minister for Political, Legal and Security Affairs in August 2015, Luhut coerced the pro-opposition leadership of Golkar into supporting the government, and then ensured one of Indonesia’s most notoriously crooked politicians, Setya Novanto, was elected Golkar chairman in May 2016.

Luhut was apparently surprised by his reassignment to the Coordinating Ministry for Maritime Affairs, and Jokowi’s lack of consultation with Luhut ahead of the reshuffle may be seen as a warning shot to the outspoken and ambitious ex-general.

However, Luhut is now overseeing energy and resources, sectors in which his company PT Toba Sejahtra has significant holdings, and which remain particularly ripe for rent-seeking. It seems unlikely that Luhut will encounter much resistance in this regard from his subordinate ministers, particularly with the removal of Sudirman Said, the former Energy and Resources Minister and ally of Vice President Jusuf Kalla.

Sudirman’s replacement, Archandra Tahar, is a little-known private consultant brought into the president’s orbit by Darmawan Prasodjo; Darmawan has himself been a close associate of Luhut’s since his appointment to the Presidential Staff in 2014.

While Luhut’s appointment seems to indicate Jokowi’s desire to make substantial progress on his program of infrastructure development – of which maritime transport and port construction is a core component – it also reinforces the view that he is a president who favours efficiency and expediency over clean government.

While much attention has focused on the promotion of an indicted human rights abuser to administer security and legal affairs – an appointment which will further Jokowi’s standing among conservative military elites – it is equally important to recognise that an alleged resource rent-seeker is now overseeing energy and resource policy. Assigning this role to Luhut, rather than a party representative, signals that Jokowi wants personal loyalists in charge of key portfolios that could play a role in the preparation – and financing – of his 2019 re-election campaign.

The notion that Jokowi is a truly reform-minded president, who is working to change the political ‘rules of the game’, is therefore no longer sustainable. Though his appointments may not reflect party loyalties, they are every bit as particularistic and politicised as those made by his predecessors in Indonesia’s highest office.

The most recent cabinet reshuffle demonstrates not only Jokowi’s increased confidence and political control, but also indicates a subtle calculation of how best to resource and manage a re-election bid that limits his indebtedness to parties.

For the next three years, we can expect the president’s personal partisans to be kept close.

Tom Power is a PhD candidate researching Indonesian political parties at the Coral Bell School of Asia Pacific Affairs, The Australian National University.


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