[Congressional Record Volume 144, Number 71 (Thursday, June 4, 1998)]
[Extensions of Remarks]
[Pages E1030-E1031]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




``U.S. POLICY OPTIONS TOWARD INDONESIA: WHAT WE CAN EXPECT; WHAT WE CAN 
                                  DO''

                                 ______
                                 

                           HON. DOUG BEREUTER

                              of nebraska

                    in the house of representatives

                         Thursday, June 4, 1998

  Mr. BEREUTER. Mr. Speaker, as Chairman of the House International 
Relations Subcommittee on Asia and the Pacific, this Member urges his 
colleagues to pay careful attention to the crisis in Indonesia. It is 
far too large, and far too important a nation to dismiss in a cavalier 
fashion. This Member would take a moment to address the ongoing crisis 
in Indonesia and to explore what the United States and the 
international community can do to help stabilize that nation's economy 
and to help promote its nascent democratization.
  Virtually all of Asia seems to be in turmoil these days, and 
Indonesia is no exception. Following months of economic turmoil and 
decline, unsatisfactory elections where the old regime sought an 
artificial vote of confidence, and weeks of student protest, President 
Suharto resigned after 32 years of autocratic rule. He leaves behind a 
nation on the edge of chaos. Although we must give Suharto due credit 
for leading his country through several decades of strong economic 
growth and development, this narrow economic success took place in the 
absence of the development of sound social and political institutions. 
The media was stifled, as were other forms of political and social 
expression.
  The tragic neglect of these institutions and basic human rights by 
President Suharto may overshadow his economic achievements; only 
history will tell. Ironically however, President Suharto's neglect of 
political reform while promoting economic reform has perhaps done more 
to debunk the myth of Asian values and expose the Asian miracle than 
any other single action.
  Most importantly, however, Suharto's neglect of political reform has 
caused much human suffering and tragedy. Indonesia's recent past has 
been marked with violence and bloodshed. Over 500 people died in the 
riots that left much of Jakarta's Chinatown in ruins. Some estimates 
have the death toll much higher. Many elites fled the country along 
with the large expatriate community, taking their capital with them.
  The current situation in Indonesia is at the same time both complex 
and fragile. The public euphoria that accompanied Suharto's resignation 
is already being replaced by the sobering reality that Indonesia is 
entering a dangerous period. Suharto--who led his nation through a 
period of dynamic growth under an autocratic system--has left behind a 
political vacuum. The various social and political forces kept impotent 
under the Suharto regime must now forge a new identity and find a way 
to reassert themselves without causing a splintering of Indonesian 
society. Proliferation of ethnic or religious-based parties that would 
pull

[[Page E1031]]

the country apart at precisely the time when unity is most fragile is a 
risk that Indonesia cannot afford to ignore.
  The Indonesian military is widely recognized as one of the linchpins 
of society. With some glaring and regrettable exceptions, it thus far 
has exercised restraint. (The same cannot be said of the police, who 
were more brutal during the demonstrations.) Commander-in-Chief Wiranto 
seems to have served as a force for change, refusing to take Suharto's 
side last week when the result could have been widespread bloodshed. 
This Member would like to believe that this restraint is at least, in 
part, attributable to the salutary effect of years of military-to-
military contacts through IMET, E-IMET and other U.S. programs that 
attempt to raise the level of professionalism of foreign military 
elites while simultaneously offering human rights training. Whatever 
the cause, the military will be under enormous pressure as a new 
government sorts itself out.
  Clearly, the economic situation in Indonesia is dire. And most 
unfortunately, indications are that the situation will get worse before 
it gets better. It is difficult for us to imagine how desperate 
conditions are. Credible economists estimate that Indonesia will suffer 
negative economic growth of between 20-25 percent in 1998. It is hard 
to over-emphasize the degree of hardship that Indonesia's people have 
faced in the past months, since the beginning of the Asian financial 
crisis last summer. Yet, despite the hopeful signs on the political 
front, Indonesia's economic crisis seems far from over. The economic 
challenges faced by Indonesia's new government would be daunting under 
the best of circumstances. But these are anything but the best of 
circumstances.
  The questions now to be addressed include: What steps must Indonesia 
take to pull its economy out of its nose-dive and restore investor 
confidence? What are the prospects for Indonesia's future? What 
political reforms are necessary, and what are possible in the near term 
and the long term? What institutional factors must first be addressed? 
And most importantly, what are the implications of Indonesia's current 
economic and political crisis on U.S. national interests?
  These questions about Indonesia's economic and political future raise 
serious questions for U.S. policy toward Indonesia. For example, as the 
largest shareholder in the IMF, World Bank, and one of the largest in 
the Asian Development Bank, we must decide when these institutions 
should resume their financial assistance to the country and under what 
conditions. In making these decisions we will appropriately have to 
decide how long a Habibie caretaker government should last and when 
elections can reasonably be held.
  As a final note, this Member strongly believes this is the time that 
the United States should focus on the issue of East Timor. For over two 
decades, East Timor has been a stumbling bloc to Indonesia's relations 
with the United States and with the European Union. There is a long and 
complicated history to this troubled corner of Asia, but suffice it to 
say that the West has never recognized the legality of the Indonesian 
incorporation of East Timor. It would seem to me that there is an 
opportunity to put aside the old inflexible positions that the various 
sides have taken in the past, and to look for new ways to move toward a 
mutually acceptable solution. Is there any role the United States might 
play in fostering such a renewed dialogue?
  Mr. Speaker, it is clear that Indonesia needs America's help and that 
of the international community. Our actions must be bold, but not rash. 
We must be thoughtful, but not timid. Certainly, we must take care to 
preserve and strengthen the delicate unity which has managed to hold 
Indonesia together, but we must not allow a new government to fall back 
into the bad practices that doomed the Suharto regime.

                          ____________________