The pandemic – misused by oligarchs?

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The Pre-Employment Card policy is vulnerable to abuses by interested oligarchic groups. What we need to be able to survive this crisis is a universal basic income. (Photo: IO/Rayi Gigih)

IO – The government’s pre-employment card policy is considered to be flawed. A similar sentiment was also conveyed by a Lecturer at the Faculty of Social and Political Sciences, Airlangga University, Surabaya, Airlangga Pribadi Kusman. According to him, the policy releases the responsibility of large economic actors towards workers. “This policy also has predatory potential and the possibility of abuse by related oligarchy groups. What is needed to overcome the crisis is universal basic income,” he said in a discussion held by Sigmaphi’s policy research and data analysis with the topic “Oligarchy in the Pandemic Period”, Friday (05/08/2020). 

According to Airlangga, the existence of pre-employment card policies is a result of the neoliberal system. While the system benefits the oligarchic group. Airlangga explained that oligarchy is a system of power that prioritizes the accumulation of wealth. The accumulation occurs through authority and collective business alliance. The existence of this group cannot be separated from State authority, according to him, because the State is no longer just in distributing wealth for citizens. Consequently, the State has become an arena for the struggle of various oligarchic groups. 

Airlangga said that the ability to adapt business forces and oligarchic politics was stamped since the Suharto era. Therefore, for Airlangga, the existence of the Indonesian Oligarchy is a legendary political problem, especially since the New Order, when depoliticization occurred so that there was no real opposition. In the historical context of the New Order, the metamorphosis of power assumes a Bonapartist state style towards oligarchy. From the power of the state that created the order of capitalism to the formation of a bureaucratic-business-political alliance with the birth of a family-based conglomerate. “After the fall of the New Order, the old social forces did not fall but survived in new institutions and expanded their alliances to the local level. Political parties are the new instrument of the oligarchy to control the country,” he said. 

According to Forbes magazine, the 40 richest people in Indonesia have a wealth of US $ 124.36 billion. “Then if the figure is compared with our average GDP / capita of US $ 3871 it will contrast by 801,509 times,” he complained. Meanwhile, according to OXFAM 2017, the concentration of Indonesia’s oligarchic wealth is the result of neoliberalism policy formulation and rent-seeking practices inherited from the New Order. For Airlangga, the policy can be seen from the practice of labor flexibility and public service budget cuts. Airlangga concluded that this then influenced the government’s public policymaking during the COVID-19 pandemic. Indonesian political economy design gave rise to the concentration of wealth in the pockets of a few people. 

He also mentioned the adaptive ability of this oligarchic group to be another problem. Political changes such as the 1998 reforms were only able to change institutions without touching their substance, namely the distribution of wealth. Meanwhile, the ongoing political mechanism, according to Airlangga, will only restore the accumulation of their wealth. ‘’The key is civil society opposition that must become aware. Civil society must oversee the work of the State because power tends to sabotage. In short, political literacy is needed,” he concluded. 

On the other hand, the process of changing economic and political institutions towards democracy does not necessarily change the nature of deep-rooted power in a country. The process of institutional transformation towards democracy and a market economy does not necessarily encourage social transformation towards liberal politics and economies characterized by rule of law, transparency of power, and protection of citizens’ rights by the state. 

Business oligarchy 

Meanwhile, a Master of Public Policy from the University of Tokyo, Gusti Raganata, stated that the condition of this pandemic gave rise to business potential that was able to survive and go bankrupt in the conditions of the COVID-19 crisis. According to him, the structure of the Indonesian economy so far has a trend of controlling assets and access to economic resources that have not changed much and are indicated to be controlled by a small group of economic actors (the Oligarchy). He further said that inequality in Indonesia has increased since the reform era as shown by the Gini ratio, the Gini ratio of land, and the control of assets and financial access in banks. “These are people with a large concentration of wealth that comes from the power of material resources which are the most flexible source of power and can be used to reach other sources of power,” he said. 

According to him, there are two ways to maintain wealth, namely, through securing claims and rights to property and second, to maintain the flow of income and profits in the condition of secure property rights. “Oligarchy is a group of actors who rule and control the concentration of a large number of material resources that can be used to maintain or enhance their wealth and exclusive social position,” he concluded. 

At the end of the discussion, he made several recommendations. First, active public supervision is needed so that the IDR 405.1 trillion stimulus fund is not misused. Second, stowaways on behalf of COVID-19 must be removed. Third, Thucydides’ trap in this oligarchy does not appear because indirectly there are still old oligarchic contributions in the process of oligarchizing new business. Fourth, the oligarchizing of digital business is indirectly following what was conveyed by Gottfreid, where there is an active role of the state, a cross-sectoral community that supports it, pyramid power, and foreign financial assistance. The emergence of oligarchs has many implications and impacts on many agents and actors in the national political economy. However, some actors, such as the state and the media, can fight it and refuse to cooperate. Fifth, COVID-19 will provide the momentum to accelerate the redistribution of assets owned by oligarchs. (Dan)