Food Wars

Irawan Ronodipuro

IO – The official campaign season has barely started, and already the incumbent, Jokowi, has a major problem on his hands that, if it is left to spiral out control, could turn into a major embarrassment for the president.  Not to mention votes in next year’s election.

The issue?  Food.  Not just food, either, but how one of the president’s favored coalition partners is allegedly exploiting its influence for personal profit and to the detriment of Indonesian consumers and farmers.

The controversy started on a recent national television program when Rizal Ramli, one of Indonesia’s more highly respected technocrats, touched some raw nerves within the Jokowi administration.  Ramli spoke out openly and forcefully about the country’s import cartels that—as Indonesians know—control the imports of rice, sugar, salt, garlic and beef.  Ramli (who formerly served as coordinating minister for maritime affairs for Jokowi) commented Jokowi was “afraid” to rebuke Enggartiasto Lukita, Indonesia’s minister of trade, about any improper and “excessive” practices being carried out by the cartels.  The reason, he argued, was Jokowi did not want to upset his coalition partner Surya Paloh, who is chairman of the National Democratic Party, or NasDem, and which also happens to be the same party to which Lukita is a member.

The reaction from Paloh’s NasDem was swift and harsh.  NasDem officials immediately threatened to take Ramli to court on charges of slander unless he retracted his statement within three days; but Ramli held his ground and managed, within the space of a few days along with his lead attorney, Otto Hasibuan, to successfully sign up more than 700 lawyers willing to provide him with pro bono legal services.

Shortly thereafter Said Iqbal, president of the United Confederation of Indonesian Workers, issued a press release in which he roundly condemned NasDem’s legal threats.  Defending Ramli’s criticism of the government for its food import policies, Iqbal warned NasDem if they continued to pursue the slander case against Ramli then he would organize his unions’ members (which numbers in the millions) for protests across the country.  Iqbal noted in his release that NasDem represented a threat to democracy, and ended by telling his members, “don’t support a political party that is against criticism.”

If NasDem does pursue its case against Ramli, they will soon discover him to be a formidable personality and intellect.  Over the years Ramli has proven himself to be a fearless advocate for democracy, and as an economist, there are few Indonesians who can match his expertise.  Ramli’s involvement in politics, which stretches back to his time as a student activist during the Soeharto era, are telling.  While studying at the Bandung Institute for Technology, in the 1970s, Ramli was rounded up by the police and sent to prison for his criticizing the regime.   After being released as a political prisoner, he completed his doctoral studies with distinction in economics at Boston University, returned to Indonesia and then founded and led Econit—a think tank that emerged as the most authoritative source of economic research in the country, and often criticized the Soeharto regime’s crony-style capitalism.  More recently, Ramli proved his capabilities in international circles when he was selected to become a member of the United Nations Advisory Panel, under which he worked with Nobel Prize winners and some of the world’s leading economists.

Paloh’s NasDem will also discover, to their dismay, that Ramli’s credentials as a technocrat over the decades and his achievements under two presidencies will surely serve him well, if not in court then certainly in the court of public opinion.  Ramli’s prominent standing as a technocrat began shortly after the 1997 Asian Financial Crisis and the subsequent fall of the Soeharto regime.  Serving under then-president Abdurrahman Wahid and in the midst of a severe economic depression with the potential to destabilize the country, Ramli was first appointed as Head of the Bureau of Logistics, or Bulog, which controlled the national distribution of key food commodities.  Ramli quickly went to work with his characteristic hands-on and pragmatic approach to reform and instituted measures to eradicate corruption inside Bulog.  After purging Bulog of its rank-and-file, Ramli was then assigned by the president to shape economic policy with the objective to accelerate recovery, which he carried out effectively in his roles as coordinating minister of economics and later as minister of finance.

So, why have the food import cartels created such a fuss, and why is it important?  Ramli, as any good economist should, understands cartels are rarely benign and, like monopolies, they often utilize their market power to charge ‘economic rents’ to consumers and can cause unfair harm to competitors (which, in this case, are Indonesian farmers); this is almost always true when governments fail to properly monitor and regulate their business activities, which is exactly what is happening with Indonesia’s food cartels.

Trade Minister Lukita, a nemesis of Ramli in the current row over food cartels given his authority to issue import licenses, has already revealed his hand about how he feels about the issue of food inflation.  Consumers were hardly amused when, asked by journalists last January about the soaring prices for red chilli peppers, Lukita replied the best solution was for Indonesians to grow chillies in their home gardens.   When Indonesians were facing increasing prices for rice, their main food staple, Lukita created an uproar when he remarked to the media that buyers should bargain for better prices.  And when eggs and chicken prices recently spiked, instead of offering solutions Lukita blamed Muslim holidays and the World Cup as being the culprits.

For now, whether of not NasDem’s chairman Paloh will continue his slander case against Ramli remains to be seen.  If he does, Ramli’s supporters, of which there are multitudes, will make sure the contentious issues swirling around food cartels will remain front and center in the media.  Logically speaking, with elections approaching, this would not be in the better interests of Jokowi, and it would be wise for the president to instruct Paloh and his party to back off.  If not, then Jokowi will need to prepare himself for defending his administration’s food import policies which, we are sure, will prove a very difficult task before the Indonesian electorate.