Attack on Corruption

Five years ago, Indonesian students joined forces with the army in an effective coalition, which eventually overthrew the country's founder and longtime President Sukarno, largely on charges of corruption and mismanagement. Now Indonesia's students are once again on the march against corruption. This time the target is their former military allies.

For weeks the students, along with the liberal intelligentsia, have been staging protest demonstrations against widespread corruption among the ruling military elite, and the press has ranted against the dishonesty of many ranking officials. Foreign companies have complained that they were forced to make payoffs in order to get permission to do business in Indonesia. Foreign investors, who are not eager to commit their money to a country where they feel corruption is holding back true economic progress, reported their objections to President Suharto, a general who is a scrupulously honest man. He listened and evidently agreed.

Last week, in an address to Parliament on the eve of the 25th anniversary of the country's independence, President Suharto pledged an all-out attack on corruption in high places. "The fight against corruption is under my direct leadership," he declared. He endorsed recommendations prohibiting government officials from accepting commissions from Indonesian and foreign businessmen. He ordered high of ficials to report their total incomes, including profits from extracurricular activities. He has also ordered the attorney general to streamline an anticorruption task force, and he submitted to Parliament a new bill that would render those who accept kickbacks and payoffs liable to fines and imprisonment.

One-Man Aid Program. Suharto faces a tough battle against corruption, for Indonesia, like most Asian countries, finds graft and payoffs an almost necessary way of life. Loyalties belong first to family and friends, with the country running a poor second.

The military commander who is most deeply involved in Indonesia's economics is Lieut. General Ibnu Sutowo. He bosses the state-owned oil company, Pertamina, which supervises operations of the 41 foreign oil companies that annually pump some 290 million barrels of petroleum from Indonesia's rich fields. Already Suharto's anticorruption commission has closeted itself for hours with Sutowo, digging into his use of Pertamina funds to expand his own influence and wealth. "I am convinced I have done nothing wrong," insisted General Sutowo in an interview with TIME Correspondent Louis Kraar. "Everybody is talking about corruption, and if you asked them what they mean, they don't know."

He readily admits, however, that he uses some $500,000 a year of Pertamina's funds in a one-man aid program. In recent ventures, Sutowo has donated television stations, mosques, airports, dormitories and hotels to army posts and towns throughout Indonesia.

"I am an army man, and I am helping everybody a lot," says Sutowo.

Though his official salary is only $200 a month, Sutowo explains that his wealth is not based merely on that income. He says frankly: "I'm very big in tobacco exports, drugstores, a textile factory, rubber estates and interests in six or seven companies. I do them in my spare time." For example, when he recently learned that a contractor in Singapore needed rocks, Sutowo got government permission to have them shipped from an Indonesian quarry. Though he invested not a cent of his own money, Sutowo collects 50% of the profits. "I just arranged it," he says.

On a recent trip to New York, Sutowo broached over lunch the idea of an Indonesian restaurant in New York to several American oil company executives. Before the meal had ended, he had pledges of $25,000 from each of the Americans. Sutowo has already acquired property on Manhattan's East Side. Another of his pet plans is a foundation, to be called Pertamina International, which he plans to use to raise funds for Indonesian cultural and educational projects in the U.S. "We expect donations to come from Americans--people who are friendly to Indonesia." And who might they be? "Oil companies," Sutowo answers promptly. But he insists that his latest projects are private undertakings and have nothing to do with Pertamina. "But, of course," he concedes, "Pertamina and Sutowo are very difficult to separate from each other."

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