This article was first published in Proletarian Revolution No. 57 (Summer/Fall 1998).

Indonesia’s Revolutionary Crisis

Of all the countries hit by the great Asian financial crash of 1997, Indonesia has gone through the most far-reaching political convulsions. A hated dictator has been ousted, and “democracy” is on everyone’s lips. But despite this victory, the capitalist democracy that most of the mass movement envisages is impossible in a country as superexploited and crisis-ridden as Indonesia. Ultimately only a socialist revolution led by the working class can avert a new period of dictatorship by the imperialism-backed military.

Built-up resentment at the 32-year reign of military dictator-president Suharto, who had himself officially “re-elected” in March, was combined with fury at the rapid inflation and other austerity measures demanded by imperialist financiers like the International Monetary Fund (IMF). Starting in January, the mixture exploded in militant strikes, mass riots against rising food and fuel prices by the poorest sections of the working class, as well as widespread student protests. The movement continued despite deadly repression by the army. It culminated in mid-May with huge demonstrations in the capital, Jakarta, and in other major cities.

Noting the size of the rallies and the ferocity of the urban riots, the ruling class forced Suharto to resign in order to prevent a mass uprising. He was replaced by Vice-President B.J. Habibie, a long-term member of the notoriously corrupt Suharto clan that has raked in profits from all economic activity in Indonesia.

Suharto had ruled through a bloody dictatorship since the CIA-backed military coup he headed in 1965-66. The coup, one of the greatest defeats suffered by the international working class since the Second World War, culminated in the murder of nearly a million people. The victims were largely ethnic Chinese and members of the PKI, then the third-largest Communist Party in the world: “the rivers ran red with blood.” The regime’s murderous history also includes the slaughter of 200,000 during Indonesia’s takeover of East Timor in the 1970’s.

Political Situation Open

Habibie is widely seen as the agent of “Suhartoism without Suharto,” but he has had to make a show of undoing the regime’s harsh rule. He has ended the outright ban on political parties, allowed the formation of independent trade unions, and promised early elections ahead of the official end of his term in 2003. The press now openly attacks Suharto and publicizes the extent of his family’s wealth. Habibie has also released some of the hundreds of political prisoners. However, leaders of the PKI, the East Timor independence fight and the radical PRD (the People’s Democratic Party; Partai Rakyat Demokratik in Indonesian) remain in prison. One of these is Dita Sari, leader of an independent trade union, the PPBI (Indonesian Center for Labor Struggle).

For a time, the political scene is wide open. New trade unions and political parties are springing up. There has been a wave of strikes, involving tens of thousands of workers, since Suharto’s fall. The movement’s main demands are the repeal of all the regime’s repressive laws and the nationalization of the assets of Suharto, his family and his cronies.

Indonesia’s situation can be compared to that of Iran after the overthrow of the Shah in 1979 or Russia after the fall of the Tsar in 1917. An oppressive regime has broken down and no stable government yet exists. In Russia the workers were organized in workers’ councils, known as soviets; in Iran, there were councils called shoras. In Russia the revolutionary Bolshevik party led the soviets to a socialist revolution. In Iran, the left parties’ failure to fight for working-class independence led to the workers’ defeat by Khomeini’s reactionary Islamic forces.

Indonesia’s working class has yet to establish its independent class organizations or declare a revolutionary road. But the reactionaries are already preparing. Racist nationalists have at times succeeded in diverting the masses’ anger against Indonesia’s Chinese minority. Often called the “Jews of Asia,” the Chinese include a wing of the big bourgeoisie that owns major shares of the largest companies. But the main victims have been the many petty-bourgeois shopowners. Like the Jews of Europe, they are a handy scapegoat to divert masses who are beginning to see that capitalism itself is the criminal oppressor.

Growing Economic Crisis

The economic crisis continues to deepen. Industry is being choked off by the collapse of the Indonesian currency, the rupiah, the drain of foreign investment and the tightening of credit. The World Bank expects unemployment to rise to 20 million in 1998, on top of 50 million underemployed – out of a labor force of 86 million. (About 11 million are manufacturing workers and another 30 million work in services or mineral extraction. The remaining 45 million remain in agriculture.) Rice stocks are dwindling to the extent that Habibie has requested people to fast two days every week.

The crisis is international in scope. All year, stock markets have been dropping across the region. The World Bank says that Asia as a whole is entering into a long, deep depression. Indonesia’s capitalists cannot pay back their $80 billion debt to the imperialists, a large chunk owed to Japanese banks. This will intensify the financial problems of Japan, the locomotive that has driven Asian economic growth. (See Asian Crisis Jolts World Capitalism in PR 56.) Taking into account the financial crisis in Russia as well as Asia, U.S. Treasury Secretary Robert Rubin warned in June:

I think it would be fair to say that the situation facing the world today with respect to financial stability is unprecedented. Business Week, a magazine that has been touting the glories of the “new economy” of globalization, editorialized:

Asia is on the brink of depression. Its deadly deflationary spiral must be reversed. Economies must be reliquefied, and companies must be recapitalized. People in the U.S., Japan or Europe who think they can dodge this bullet are dreaming. (June 1)

As always, this means: capitalism is in trouble, profits are endangered, therefore workers must pay. Indonesia has served this goal by providing cheap labor for decades, enforced by the military jackboot. For imperialism to renounce this enormous source of superprofits would mean risking the health of world capitalism itself. The imperialists will go to any lengths to squeeze debt repayments out of the working classes of the “third-world” nations, as well as making the workers at home tighten their belts further.

Indonesia’s economy had achieved dramatic growth in recent decades, based originally on the oil boom of the 1970’s but now including rapid industrialization on the backs of a growing working class. But this meant misery for the great majority, especially peasants who were forced off the land to join the desperate army of the unemployed in the cities seeking jobs in the sweatshops. As conditions for the masses worsen, it becomes less likely that the cosmetic shift from Suharto to Habibie will quell the storm.

The Opposition Forces

The current upsurge has its roots in struggles that got under way some years ago. New unions independent of the regime formed in the early 1990’s. In 1996, Suharto’s military took over one of the two legal bourgeois opposition parties, the Indonesian Democratic Party (PDI). The army dismissed the PDI’s leader, Megawati Sukarnoputri, the daughter of former president Sukarno, the nationalist leader who had headed the country in the initial period of independence from Dutch colonial rule after World War II. After mass protests, combined with workers’ strikes for better wages and against military interference with unions, major trade union and opposition leaders were arrested.

Particularly targeted for repression was the PRD. It was formed in 1994 out of several student activist organizations which had supported campaigns over workers’ and peasants’ issues. Its program is radical bourgeois democracy: its main goal has been to win a “People’s Coalition Government” through methods of mass struggle. It has been in a bloc supporting the PDI and the other bourgeois opposition, the Muslim-based United Development Party (PPP).

The regime labeled the PRD “communist,” trying to revive fears of the PKI that had been vilified and exterminated in 1965. But the PRD’s program has nothing in common with proletarian revolution. In 1996, the PRD called for Megawati of the PDI to be president. This year, when the mass upsurge broke out in May, the PRD demanded that Suharto be replaced by an opposition government; it proposed participation by Megawati, Amien Rais, head of the Muslim mass organization Muhammadiyah (who has reportedly encouraged attacks against ethnic Chinese), Budiman Sudjatmiko, the chairman of the PRD and the chair of the PPP, both of whom are still in jail.

The program of the reform bourgeois bloc sounds like those of Nelson Mandela in South Africa or Kim Dae Jung in South Korean, themselves former imprisoned dissidents; Kim’s election as president last year ended decades of rule by military-backed politicians. Mandela has already sacrificed his promises to the masses for the profits of capital; Kim is clearly on the same path. The reformist Indonesian bourgeoisie’s goal is shown by a statement from an economic adviser to Megawati (Washington Post, May 17):

We need a transition period. Post-Suharto, the economy is going to be terrible. What we need is a leader who has influence and who is respected by the people, who can tell 200 million Indonesians to sacrifice more.

In the same tone, Secretary Rubin said in June that the crisis-ridden Asian countries needed both the IMF austerity measures and a social safety net “so that you can maintain your public and political support for what needs to be done. You’ve got wrenching changes in countries that are in very difficult circumstances.” (New York Times, June 29.)

“What needs to be done,” gently persuading the masses to sacrifice, may be the ruling class’s strategy for the moment but is not likely to last for the longer run. In more prosperous countries, popular bourgeois leaders like Kim can hope to use “reforms” to bring down workers’ wages, although its monopoly of armed force remains the ruling class’s last resort. But where the bulk of the working class is already at the bare edge of subsistence, belt-tightening almost inevitably requires brute force. While the capitalists would prefer a pseudo-democratic solution, the system’s crisis will demand a renewed military dictatorship in Indonesia to enforce further austerity and intensified exploitation.


Despite its program for bourgeois-democratic rule, the PRD is admired by much of the international far left as the best hope for the Indonesian masses and a beacon for the struggle against imperialism. Its most active promoters are the Australian journals Green Left and Links. In the U.S., one champion has been Against the Current, the magazine published by the Solidarity group. Board member Malik Miah, who is also co-editor of the newsletter Indonesia Alert, rhapsodized about the PRD in the January/February issue:

The PRD... symbolizes what Suharto’s military and Washington fear most: young people in their teens and twenties who are ready to fight and die for a democratic government and control of the country’s vast wealth.

The ruling class no doubt hates anyone who challenges its power, but its fear is of the working class, which represents a challenge to capitalist property in all its forms. Miah takes up the regime’s denunciation of the PRD as communist, retorting: “How could these youth be communists? They weren’t even born in 1965!“ Indeed, the PRD’s program cannot seriously be called communist; its “struggle for democracy” evades the issue of doing away with capitalism. Nevertheless, the PRD is not far from the actual program of the PKI, which Miah refuses to admit.

Miah does endorse a critique of the PKI’s policies:

The leadership of the PKI willingly... followed Sukarno’s personal leadership and teachings. Sukarno was considered by the party to be a “pro-people’s element” and even the “great leader of the revolution.”

The betrayal of the masses that this policy meant has to be spelled out a bit. After revolutionary origins in the 1920’s, the PKI’s main leaders were exiled, and the party became reformist under the impact of the Stalinist counterrevolution in the USSR and the predominance of petty-bourgeois elements in its leadership. It revived when Indonesia won independence after World War II, often supporting “progressive” bourgeois nationalists like President Sukarno. In the 1960’s, after the split between Chinese and Soviet Stalinists, it followed China’s “anti-imperialist” Maoist rulers and joined the government bloc. It endorsed Sukarno’s “guided democracy” under the rubric “Nasakom” – nationalism, Islam and communism together. This popular front policy drove it and the masses it led to disaster.

In 1957, for example, there was a mass upsurge of the workers and peasants, who occupied factories, plantations, banks and ships. The trigger was Sukarno’s call for a general strike against Dutch-owned companies, in a dispute over remaining colonial holdings. But when the masses seized enterprises throughout the country, Sukarno ordered the military to take over control. The PKI, loyal to Sukarno, agreed that the seized firms should be handed over to the government – and that imperialist companies that were not Dutch-owned should be returned to their bosses. The PKI’s support saved Sukarno’s regime, but its policy of trusting the generals led to the massive defeat and its own destruction.

Then came 1965. A revived workers’ movement began taking over oil and rubber plantations. The PKI thereupon joined the government, sitting alongside generals whom it insisted were still part of the “people’s democratic revolution.” When Sukarno banned all strikes, the PKI went along because nationalist unity was its priority, not working class independence. Even when the military began its pro-Sukarno coup, the PKI relied on Sukarno and its friends in the army for defense. The result was one of the greatest pogroms in history.

The PRD’s “Democratic Revolution”

The PRD has not of course had the opportunity to commit betrayals of this order. But its ideology of “people’s power” and its support for “anti-imperialist” bourgeois politicians undermines working-class distrust of the bosses and generals and paves the way for future defeats.

Miah shares the PRD’s illusions. He writes:

The coming revolution in Indonesia will be a democratic one. It will be national and take up both political and economic demands. It will end the Suharto dictatorship, establish full democracy where all social forces (and ethnic groups) and classes can function without fear of terror, and grant the East Timor people self-determination....

This is the standard stage theory of reformists, which says that democracy must be won before the working class can fight for socialism. This means that the workers are in fact held back from fighting the capitalist system behind the dictatorship. Because the working class is the only force powerful enough to topple the dictators, this strategy leads to “popular-front” governments that tie the workers’ organizations to bourgeois parties, with the workers’ and peasants’ interests inevitably subordinated to those of capital.

Popular fronts have led to smashing defeats because the working class was ideologically and organizationally tied to sections of the ruling class. This happened in China in 1927, Spain in the 1930’s – and Indonesia in 1965. Even though Miah asserts that the PRD and its allies “are not relying on the elections or splits in the army, and refuse to subordinate their campaign to big business or those seeking to reform the regime’s institutions,” subordination to capital is the lesson of popular-frontist history. It is criminal that socialists who know what the PKI’s strategy led to can encourage parallel policies in Indonesia today.

Trotsky’s theory of permanent revolution explains that the bourgeoisie, however democratic its pretensions, will defend its property fiercely, as the foundation of its class power. Any mass threat to the property of some is a threat to the property of all. The tame and friendly bourgeoisie implied in “people’s power” slogans is a myth.

Thus the tasks of the bourgeois democratic revolution – the right of self-determination, political democracy, division of the land for the peasantry – can only be carried out by the proletariat in the course of making the socialist revolution. By championing democratic rights, the proletariat can gain the alliance and support of members of the middle classes and the peasantry. Further, the workers’ revolution must spread internationally, since economic survival depends on the world system of production, its division of labor and its potential to create abundance. This potential is beyond the capacity of any one country, especially one kept backward by imperialism.

New Workers’ Parties

In addition to the PRD, new working-class parties are being formed. Muchtar Pakpahan, the head of Indonesia’s most prominent illegal trade union under Suharto, was released from prison after the dictator’s fall. His union, the SBSI, the Indonesian Union for Workers’ Welfare, organizes factory and transport workers and was legalized by Habibie. It was involved in a 20,000-strong mass strike in Medan, Sumatra in 1994 that led to Pakpahan’s jailing.

According to International Viewpoint, Pakpahan now calls for a National Workers Party, “based on workers, small business people, intellectuals and progressive non-governmental organizations.” He has also invited Megawati Sukarnoputri to be the party’s head. This party would be in competition with the Indonesian Workers party, which was founded in late May by the government-supervised unions. Despite the courageous defiance of the old regime by leaders like Pakpahan, any working-class party that ties workers to even the oppositional bourgeois parties is no step forward.

For a Revolutionary Workers’ Party

Only workers on the ground in Indonesia can formulate the precise policies needed to take their struggle forward. But the long international experience of the class struggle, including the Indonesian disaster of 1965, screams out against the seemingly straightforward “democracy” strategy promoted by the left both inside and outside Indonesia.

The rivers will again run red with the masses’ blood unless the most class-conscious workers fight to lead the working class in an independent struggle to overthrow capitalism, secure the democratic rights the masses demand and go on to build socialism. This can only be achieved by smashing the capitalist state and building a workers’ state of armed workers governed by workers’ councils. Key policies of a workers’ state would be nationalization of the big businesses and the implementation of an economic plan that replaces capitalism’s profit drive by planning production in the masses’ interests.

Toward this end the revolutionary workers need to build their own vanguard party, not the PRD or a popular-frontist workers’ party. In addition to organizing and politically educating the advanced workers, a revolutionary party would seek to lead the masses in all their struggles with the aim of proving to them the need for the socialist revolution. The touchstone of revolutionary policy would be to always warn the masses of the treachery of the reformist leaders and encourage the workers to rely on their own strength and independent organization.

Far from denying the importance of the struggle for democracy, a revolutionary party would prove itself the only reliable champion of the democratic cause. The reformists preach a peaceful and gradual struggle for democracy which is only allowing the old Suharto dictatorship to regather its strength. But revolutionaries would fight for the struggle to press ahead to the overthrow of the dictatorship. Unlike the reformists, who seek to form a new government in back-room deals, revolutionaries would fight for a constituent assembly of elected representative of the whole Indonesian people. Their party would fight for the right of self-determination of the oppressed peoples of East Timor and Irian Jaya, and defend the ethnic Chinese against nationalist mobs. And it would champion the interests of the peasants and exploited rural poor against the big landowners.

While revolutionaries must explain that the full democracy of a constituent assembly will not be secured without the overthrow of capitalism and the creation of a workers’ state, the masses must be convinced of this by their own experience in the struggle. The slogan for a constituent assembly will thus clearly formulate their democratic aspirations and expose the bourgeois democrats who will fear the power of such an assembly.

In connection with the democratic struggle, revolutionaries must always bring to the fore the independent interests of the working class. Revolutionaries should clearly focus the masses’ economic demands, calling for the repudiation of the imperialist debt, the extension of the masses’ calls for the seizure of Suharto’s wealth to the seizure of all the big businesses including the imperialists’, for a living wage that increases with the price of goods, and for an eight-hour day with no loss in pay.

To mobilize the masses in the struggle for these demands, revolutionaries should fight for the most powerful form of working class struggle: the general strike, and advance the formation of workers’ action committees to organize the struggle. Most importantly, revolutionaries cannot raise the pacifist illusion that the masses can struggle for their demands without an armed confrontation with the military and police. Revolutionaries would look for every opportunity to encourage the arming of the masses and the formation of workers’ defense guards. And revolutionaries would seek to split the army by winning to the masses’ side the working class soldiers (there are undoubtedly many soldiers who would join or aid a popular militia, like the marines who refused to fire on protesters in mid-May).

A workers’ victory in Indonesia would inspire struggles throughout Asia and begin the battle for working-class power everywhere. The crisis, along with imperialism’s austerity attack, has already hit Southeast Asia and South Korea. China also faces a financial crisis, and its immense proletariat, increasingly subject to the world’s economic gyrations, is restive. And Japan’s working class, the heart of proletarian power in Asia, is facing pressure from all the world’s imperialists to sacrifice more after a decade of recession.

One way to win international solidarity would be for the developing Indonesian trade unions and workers’ parties to spread the call for the repudiation of the imperialist debt. A campaign toward this goal should be waged by revolutionary workers in all the countries under the imperialist thumb, placing such a demand on the leaders of the big workers’ organizations. An all-Asiam general strike to repudiate the debt, by the working classes under attack from Indonesia to South Korea, would be a giant step forward towards the defeat of imperialism. Moreover, the way the same crisis and attacks are hitting the workers of so many Asian countries simultaneously presents the opportunity for a general strike of all workers across South East Asia, which would be a remarkable display of working class power.

For a Revolutionary Working-Class Party in Indonesia!

Down with the IMF! Repudiate the Imperialist Debts!

For a Socialist Federation of Asia!