Can Indonesia Find Stability After Suharto?

A RECENT explosion of industrial unrest in Indonesia is shaking the delicate political balancing act of President Suharto.

In April, rioting by factory workers angry over low wages, poor working conditions, and the mysterious death of a union activist closed down the north Sumatran city of Medan for several days. The outburst grew out of long-standing labor restiveness and Indonesian workers' seething resentment against ethnic Chinese. A Chinese factory owner was beaten to death by rioters in Medan where, like the rest of Indonesia, ethnic Chinese dominate the economy.

In a country that has prospered but enjoyed little political freedom under Mr. Suharto's 27-year-rule, the violence lays bare deep-seated tensions within society that could disrupt his recent experiment with limited political openness and bring tough military action against future strikes, Indonesian analysts say.

The discontent also could spread to other restive pockets and deepen insecurity over Indonesia's political future after the 72-year-old Suharto steps down from power, analysts say.

``Indonesians have become more wealthy and are concerned that the country should not break up,'' says C.P.F. Luhulima, a political analyst at the Indonesia Institute of Science. ``Their fear is that if developments in the political succession cannot be controlled, the country will break apart.''

A retired general and one of Asia's longest-ruling autocrats, Suharto has proved to be a master politician, playing advisers and rivals against each other in the tradition of the old Javanese kings. Under his stewardship that began in the stormy aftermath of a failed coup attempt in 1965, Indonesia has changed from a poverty-stricken backwater into a potential Asian economic powerhouse that has grown steadily in the political calm imposed by the president.

Still, facing emerging new pressures for change, the president has allowed a modicum of debate in recent years. The media has been given more freedom, and campuses and independent labor unions, suppressed since the military crackdown following the 1960s coup attempt, which the government blamed on communists, have come alive with new protests.

Just five months ago, Suharto put down his critics and demands for more democracy by accusing them of using tactics of the long-banned Communist Party. But the president was recently forced to acknowledge the explosiveness of labor unrest and called for higher industrial wages although not at the expense of Indonesian competitiveness. ``The wage system should not widen the social gap,'' he says. ``We should also give attention so that this wage system can continue to stimulate the business world.''

Stonewalling speculation that he might step down before his sixth term expires in 1998, Suharto reaffirmed recently that he would serve out the full five years. With his eye on a place in history, the leader has sought a higher international profile as head of the Non-Aligned Movement, a grouping of third-world countries, and host to an upcoming conference of the nascent Asia Pacific Economic Cooperation Forum.

But Suharto, who has yet to designate a successor or allow open debate over the issue, has hinted he might not seek a seventh five-year term amid new difficulties. Although the economy is projected to grow more than 7 percent this year and exports are booming, foreign investment is slowing, the banking system is in crisis, and deregulation of the public sector and trade has stalled.

Indonesia continues to grapple with separatist unrest, particularly in East Timor. Although open resistance has waned, security forces confront younger, antagonistic Timorese who will not let opposition to Indonesian rule die.

Suharto is also increasingly on the firing line over his highly personalized rule and promotion of proteges and his family's vast business interests. Indeed, the high political profile and crony capitalism of Suharto's children has become a growing political liability, analysts say.

Last October his son, Bambang Trihatmodjo and his daughter, Siti Hardijanti Rukmana won high-level appointments in Golkar, Indonesia's dominant political party and vehicle for Suharto's control.

The First Family presides economically over some of Indonesia's most prosperous sectors, including oil drilling, natural gas and petrochemicals, timber and plywood, satellite services, aviation, and property development.

Bambang's Bimantara Citra Group has become one of Indonesia's top 10 conglomerates through preferential government contracts. Ms. Siti espouses social causes funded through a maze of business enterprises. And Hutomo Mandala Putra, Suharto's youngest son, heads one of the country's fastest-growing conglomerates.

Like the president himself, the Suharto children are closely linked to ethnic Chinese tycoons in business alliances that fuel the undercurrent of bitterness against the Chinese community, which accounts for only 4 percent of Indonesia's 180 million people.

Political observers say Suharto's concerns about protecting his controversial children could influence a decision to step aside in the coming years. The president could give in to calls from liberals and some military officials to step down if he can assure his children's security.

``If staying in office is seen as endangering his children, he could agree to remove himself from the scene,'' says Abdurrahman Wahid, Indonesia's most prominent Muslim leader and a democracy advocate who is close to generals trying to dilute Suharto's power. ``When he's gone, he doesn't want his children to be given harsh treatment or be placed under detention.''

As political succession has become almost an obsession in Indonesia, the military's once sacrosanct, but still pivotal, role in politics and security faces new questions.

Last October, Suharto raised military hackles by naming a civilian crony, Information Minister Harmoko, as the first nonmilitary chairman of the ruling Golkar party machine. The president has also backed an Islamic revivalist movement among the middle class in what is seen as a religious challenge to military influence.

Still, the appointment of a former armed forces chief, General Try Sutrisno, as vice president last year positions the military for a reassertion of power in the post-Suharto era.

To keep power in the Suharto family, another candidate is the president's brother-in-law, Gen. Wismoyo Arismunandar, Army chief who is in line to become head of the armed forces.

Some analysts believe that factions within the divided military also backed the election late last year of Megawati Sukarnoputri as head of the opposition Indonesian Democratic Party. The rise to prominence of the daughter of Sukarno, the charismatic first president of Indonesia, was seen as a challenge to the government's tight political control.

``The military hasn't liked Suharto's efforts to push them back to the barracks,'' says a senior Western diplomat in Jakarta. ``The military wants to put into the succession process a person that it thinks it can control.''

Indonesian liberals hope that the passing of the Suharto era will lead to a more open political system. But other analysts are skeptical, saying that Indonesia lacks the economically powerful middle class that can challenge military dominance in the vastly diverse archipelago.

``Some people say that if democracy comes, the political system will change. But that won't work. Indonesia has to have a strong central government,'' says Mr. Luhulima, the political analyst. ``The question comes up whether the security forces can maintain control.''