MEETING ON INDONESIA -- JULY 2, 1969

• Document Type: CREST
• Collection: Library of Congress
• Document Number (FOIA) /ESDN (CREST): LOC-HAK-105-2-2-0
• Release Decision: RIPLIM
• Original Classification: C
• Document Page Count: 4
• Document Creation Date: January 11, 2017
• Document Release Date: December 10, 2010
• Sequence Number: 2
• Publication Date: July 25, 1969
• Content Type: MEMO

C tC N I r No Objection tobeclassification in Part 2010/12/10: LOC-HAK-105-2-2-0
JULY 25, 1969
PER YOUR REQUEST, THERE FOLLOWS THE MEMORANDUM FOR THE
RECORD ON THE INDONESIAN MEETING OF JULY 2, 1969.
MEMORANDUM FOR THE RECORD
SUBJECT: MEETING ON INDONESIA -- JULY 2, 1969
PARTICIPANTS: GUY A. PAUKER. RAND CORPORATION
A. KibbiNGER
HLNKT
JOHN H. HOLDRIDGE
WILLIAM A. K. LAKE
THE ARMY: PAUKER IDENTIFIED THREE GROUPS WITHIN THE ARMY
THE GROUP OF ANTI-COMMIIST, NATIONALIST YOUNG OFFICERS WHO
PROVIDED SUHARTO'S EARLY BACKING, SOME REMAINING PRO-SUKARNO
GENERALS AND A GROUP OF JAVANESE OFFICERS WHO ARE GENERALLY. LESS ACTIVE, MORE CORRUPT AND MORE TRADITIONAL IN OUTLOOK
THAN THE YOUNG NATIONALISTS. SUHARTO HAS BEEN DRAWING CLOSER
TO THE JAVANESE OFFICERS RECENTLY -- HE SHARES. THEIR JAVANESE
RELATION AND THEIR FEAR OF MUSLIM ORTHODOXY. THIS TRADITIONAL
JAVANESE FEAR OF THE MUSLIMS, WHO COMPRISE 45 PER CENT OF
THE VOTERS HELPS EXPLAIN THE HISTORY OF AND UNCERTAIN
PROGNOSIS FOR ELECTIONS.IN INDONESIA.
SUHARTO HAS BEEN MOVING SOME OF THE NATIONALIST ACTIVISTS
AWAY FROM DJAKARTA AND INTO THE PROVINCES, NOT SO MUCH THROUGH
FEAR OF THEM AS BECAUSE HE BELIEVES THEY CREATE DIVISIONS AND
A COMPETITIVE SPIRIT WITHIN 'THE ARMY.
THE JAVANESE GENERALS ARE LESS FAVORABLE TO A FREE MARKET
ECONOMY THAN THE YOUNG ECONOMISTS (MANY OF WHOM WERE TRAINED
AT BERKELEY). THE ECONOMISTS ARE ALSO CLOSE TO SUHARTC.
PAUKER BELIEVES THE DANGER IS THAT IF THE CURRENT ECONOMIC
POLICY IS NOT SUCCESSFUL, THE JAVANESE GENERALS COULD GET
SUHARTO TO MOVE TOWARD MORE STATE CONTROL: THE NEW FIVE-
YEAR PLAN HAS JUST BEGUN, HOWEVER, AND THE RATE OF INFLATION
HAS SLOWED AT LEAST TEMPORARILY TO FIVE PER CENT PER YEAR.
PERSONALITIES
SUHARTO: PAUKER SAID THAT SUHARTO HAD NEVER INTENDED TO
BE PRESIDENT, BUT HE TOOK CHARGE ON THE MORNING OF OCTOBER
"1, 1965 AND APPOINTED HIMSELF COMMANDER OF THE ARMY. EVEN
THEN, HE DEFERRED TO NASUTION ON POLITICAL MATTERS UNTIL
FEBRUARY 1966 WHEN SUKARNO FIRED HSUTION. SALARTO GAINED
THE ARMY'S SUPPORT BECAUSE OF HIS RECORD OF COMPETENCE.
..SUHARTO IS STILL POPULAR BQR HIS PERSONAL INTEGRITY.
HE LIVES IN A MODEST HOUSE AND IS A FAMILY MAN. ANOTHER ELEMENT
IN HIS POPULARITY, HOWEVER, IS HIS TOLERANCE OF.':THE
ND OF
o Declassification in Part 2010/12/10 : LOC-HAK-105-2-2-0
POLITICS
 No Objection to Declassification in Part 2010/12/10: LOC-HAK-105-2-2-0
UUNMUtN I II1L
"WEAKNESSES" OF HIS COLLEAGUES.
FOREIGN MINISTER MALIK: LIKE THANAT IN THAILAND, MALIK
IS A TECHNICIAN WITH NO PERSONAL POWER BASE. HE IS VERY
BRIGHT AND WOULXSLIKE TO LEAD A POLITICAL MOVEMENT, BUT
WOULD NOT KNOW HOW. HE IS ANTI-COMMUNIST BUT ON GOOD
RELATIONS WITH SOVIET DIPLOMATS.
SULTAN OF JOGJAKARTA: THE SULTAN IS HELD IN RELIGIOUS
AWE BY ALL JAVANESE. HE HIMSELF, HOWEVER, TRIES TO BE
INFORMAL IN HIS RELATIONS WITH.HIS COUNTRYMEN. HE IS REPORTEDLY
NASUTION: NASUTION HAS BEEN SHUNTED OFF TO A HIGH 0107 AL-'/
MEANINGLESS POLITICAL JOB. HE PLAYED HAMLET AFTER THE 1965
COUP9 AND THEREFORE GAVE WAY TO SUHARTO. NASUTION DID NOT GAIN
THE SUPPORT OF THE JAVANESE GENERALS BECAUSE HE IS SUMATRAN,
OF A DIFFERENT TEMPERAMENT, AND SOMETHING OF A PURITANICAL,
MARTINETTE.
3. POLITICAL SITUATION AND PROGNOSIS.
PAUKER DESCRIBED THE PRESENT REGIME AS "A NON-FLAMBOYANT
SUKARNO TYPE"GOVERNMENT. THE PARLIAMENT HAS THE POWER TO
OBSTRUCT AND A LIMITED POWER TO LEGISLATE; THE PRESIDENT
HAS SWEEPING POWERS. TIC- ALLOCATIONS OF SEATS IN THE
PARLIMENYT' WAS NEGOTIATED IN SUHARTO'S OFFICE. NEW ELECTIONS
ARE SCHEDULED FO1 1971, BUT SOME DOUBT WAS EXPRESSED ABOUT
WHETHER THEY WILL BE HELD AT THAT TIME.
THE POLITICAL PARTIES ARE NOT HAPPY WITH THE PRESENT
SITUATION. THEIR EXCLUSION FROM THE GOVERNMENT MEANS THAT THEY
CANNOT USE GOVERNMENT POSITIONS TO SELL LICENSES, ETC.
(INDONESIA'S FOREIGN EXCHANGE EARNINGS ARE ONLY SEVERAL HUNDRED
MILLION DOLLARS A YEAR. THEREFORE, THE "POT" IS RELATIVELY
SMALL FOR THE ELITE GR-OUPS WHICH ARE TRYING TO GET THEIR
CUT.) THE JAVANESE GENERALS, ON THE OTHER HAND, WANT THE
ARMY BNQH TO STAY OUT OF PARTY POLITICS AND TO MAINTAIN POWER.
THE PARTICIPANTS AT THE MEETING AGREED THAT THE POLITICAL
SITUATION WOULD STAY ABOUT THE SAME FOR THREE TO FIVE YEARS,
BUT THAT THERE ARE DANGERS OF POLARIZATION. MANY OF THE PNI'S
MEMBERS COULD BECOME RADICALIZED, WITH THE SUPPORT OF THE
JAVANESE GENERALS. THEY WOULD NOT CALL THEMSELVES COMMUNISTS,
BUT WOULD BE MORE XENOPHOBIC AND OPPOSED TO FREE ENTERPRISE.,
THE MUSLIMS, ON THE. OTHER HAND, COULD PUSH STILL HARDER FOR
A MUSLIM STATE IN INDONESIA.
THE TRANSLATION OF CENTRAL GOVERNMENT DIRECTIVES INTO
LOCAL ACTION REMAINS VERY POOR. THE CIVIL SERVICE IS, VASTLY
OVERSTAFFED. THIS SITUATION DISCOURAGES INVESTORS
No Objection to Declassification in Part 2010/12/10: LOC-HAK-105-2-2-0
 x ECONOMY No Objection to Declassification in Part 2010/12/10: LOC-HAK-105-2-2-0
ALTHOUGH THERE HAVE'BEEN SOME ENCOURAGING ECONOMIC
DEVELOPMENTS -- E. G. , THE LOANS, THE SLOWED RATE OF INFLATION,
ROADBUILDING, ETC. -- THERE HAS NOT BEEN REAL FORWARD PROGRESS
AND UNEMPLOYMENT REMAINS VERY HIGH, -ANY OF THE PEOPLE ARE
RESTLESS IN AN INDONESIAN WAY -- THEY ARE VERY SUBDUED.
IS MAJOR PROBLEM IS THAT NEW INVESTMENT IS IN EXTRACTIVE
INDUSTRIES IN NON-JAVANESE AREAS. IT DOES NOT THEREFORE
:REATE EMPLOYMENT IN JAVA.
POPULATION PRESSURES ARE GROWING, PARTICULARLY, OF COURSE,
)N ARABLE LAND. ON THE BRIGHT SIDE, FOOD PRODUCTION IS INCREASING
AND THE FOOD BATTLE COULD BE N F THE PEOPLE WILL ACCEPT
ND OF,PAGE TWO WNW
j';7,7 -7 E TIA.t
FOOD THAT DOESN'T TASTE AS GOOD AS THAT TO WHICH THEY ARE
ACCUSTOMED AND PROBLEMS OF DISTRIBUTION CAN BE LICKED.
THE NEW FIVE-YEAR PLAN IS HEAVILY DEPENDENT ON FOREIGN
ASSISTANCE. IT MAY BE UNREALISTIC IN ITS PROJECTIONS ON
DOMESTIC SAVINGS. INDONESIA'S ABILITY TO ABSORB MUCH GREATER
AMOUNTS OF U.S. AID, HOWEVER, IS LIMITED.
IN SUM, IT WAS AGREED THAT THE ECONOMY IS STAGNATING OR
MAKING SLIGHT PROGRESS, BUT THAT EVEN THIS IS AN ACCOMPLISHMENT.
6. FOREIGN POLICY
SUHARTO HAS TO RELY i 4ORE ON THE WEST FOR AID THAN DID
SUKARNO;YE CULTIVATES GOOD RELATIONS WITH US MORE BECAUSE
OF THIS FACT THAN FROM IDEOLOGICAL AGREEMENT. THE INDONESIAN
GOVERNMENT IS PREOCCUPIED WITH DOMESTIC AFFAIRS, AND WILL
THEREFORE PROBABLY NOT UNDERTAKE ANY GREAT INTERNATIONAL ROLE
IN THE NEXT FEW YEARS.
THE INDONESIANS BELIEVE THAT THEY SHOULD DOMINATE THE
AREA, ALTHOUGH THEY DISCLAIM IMPERIALIST INTENTIONS. PAUKER
SAID THAT THE INDONESIANS WOULD JOIN AN ASIAN ALLIANCE IF
THEY LED IT; THEY ARE JEALOUS OF INDIA, HOWEVER, AND WOULD
NOT JOIN AN ALLIANCE LED BY INDIANS. THEY WOULD BE CAUTIOUS
ABOUT JOINING A SOVIET PACT. MALIK FEARS MILITARY
ALLIANCES, AND WOULD PREFER -A WEB OF BILATERAL RELATIONSHIPS
ON WHICH HE COULD COUNT IN TIMES OF TROUBLE.
PAUKER DISPUTES THE VIEW THAT THE ARMY STOOD UP TO THE
COMMUNISTS IN 1965 BECAUSE OF OUR COMMITMENT TO VIETNAM. HE
SAID THAT THE INDONESIANS FIND. THIS ARGUMENT OFFENSIVE. HE
ARMY MIGHT HAVE GONE ALONG WITH THE COMMUNISTS IN THE EARLIER
1950'S , AFTER CHINA WENT COMMUNIST, IF THERE HAD BEEN NO
SEVENTH FLEET IN THE AREA.
No Objection to Declassification in Part 2010/12/10 : LOC-HAK-105-2-2-0
 No Objection to Declassification in Part 2010/12/10 : LOC-HAK-105-2-2-0
WITH REGARD TO VIETNAM. PAUKER NOTED THAT WHILE THE LEADER-
SHIP IS ANTI-COMMUNIST, IT HAS AMBIVALENT FEELINGS ABOUT THE
NATIONAL LIBERATION FRONT AS THEY FEEL SOME EMPATHY TOWARDS
A "LIBERATION GROUP." THE INDONESIANS WOULD NEVERTHELESS
LIKE US TO SEE IT THROUGH IN VIETNAM, AND WILL EXPCESS THE
HOPE DURING THE PRESIDENT'S VISIT THAT WE WILL AVOID PRECIPITATE
WITHDRAWAL. THEY WILL BE WISITY-WASHY, HOWEVER, IN STATING
ANY SUPPORT FOR OUR EFFORTS IN VIETNAM
THE KINSHIP BETWEEN THE MALAYS IN MALAYSIA AND THE INDONESIANS
WAS NOTED. THERE WAS AN OMINOUS TONE TO REPORT'S OF INDONESIAN
OFFERS OF HELP TO THE MALAYSIAN GOVERNMENT DURING THE RECENT
COMMUNAL RIOTS. LEE IN SINGAPORE HAS AN ALMOST PARANOIC
FEAR OF AND CONTEMPT FOR INDONESIA. ON THE OTHER SIDE, THE
INDONESIANS FEAR CHINESE SUBVERSION AND, PAUKER SAID, THE POSSIB-
ILITY THAT THE CHINESE COULD GAIN CONTROL OF THE JAPANESE
INDUSTRIAL BASE FOR THEIR OWN EVIL DESIGNS. PAUKER ALSO SUGGESTED
Y
THAT THE INDONESIAN ARMY COULD BE USEFUL IN COUNTER-INSURGENC
OPERATIONS IN THAILAND. THE INDONESIANS WOULD ALSO TAKE PART,
HE SAID, IN A PEACE-KEEPING FORCE IN VIETNAM.
PRESIDENT'S VISIT
THE INDONESIANS WILL CIRCUITOUSLY SEEK ASSURANCES OF CONTINUED
AID. THE ARMY WISHES CIVIC ACTION EQUIPMENT RATHER THAN MORE
MILITARY EQUIPMENT; IT WILL NOT REQUIRE THE LATTER FOR FIVE
MORE YEARS. THE PENTAGON'S POLICY IS TO PROVIDE THEM WITH
EQUIPMENT TO USE IN HELPING THE POPULACE, IN ACCORDANCE WITH
U.S. CIVIC ACTION DOCTRINE. THE INDONESIANS, ON THE OTHER HAND,
WANT IT TO BUILD FACILITIES FOR THE ARMY -- FOOD STORAGE,
HOUSING FOR THE TROOPS, ETC. PAUKER BELIEVES THAT WE
ON
END OF PAGE THREE T
IAL
SHOULD GIVE THE.INDONESIANS WHAT THEY
'
S.
,AIR FORCE WANTS B-25'S AND B-26
WANT. THE INDONESIAN
THERE' ARE NO UNPLEASANT BILATERAL PROBLEMS BETWEEN US.
PAUKER SUGGESTED THAT WE ASK THE INDONESIANS -- PAR-
HEIR MILITARY INTELLIGENCE CHIEF -- ABOUT THEIR
TICULARLY T
COUNTER-INSURGENCY METHODS, ESPECIALLY PHOENIX-TYPE OPERATIONS.
WE COULD LEARN FROM THEM IN THIS REGARD.
D'I'G 2515472 JUL. 69
2220 IMI 2220
Pflk$r1nrtJTJA v
No Objection to Declassification in Part 2010/12/10: LOC-HAK-105-2-2-0