Jakarta (meet the new boss… same as the old boss)

photo: AFP

By way of introduction… a short book review.

from Amazon.com

“From the tragedy of 9/11 to the farce of the financial meltdown—but underlying both is the irrationality of global capitalism. In this bravura analysis of the current global crisis—following on from his bestselling Welcome to the Desert of the Real—Slavoj Zizek argues that the liberal idea of the “end of history,” declared by Francis Fukuyama during the 1990s, has had to die twice. After the collapse of the liberal-democratic political utopia, on the morning of 9/11, came the collapse of the economic utopia of global market capitalism at the end of 2008. Marx argued that history repeats itself—occuring first as tragedy, the second time as farce—and Zizek, following Herbert Marcuse, notes here that the repetition as farce can be even more terrifying than the original tragedy.

The financial meltdown signals that the fantasy of globalization is over and as millions are put out of work it has become impossible to ignore the irrationality of global capitalism. Just a few months before the crash, the world’s priorities seemed to be global warming, AIDS, and access to medicine, food and water—tasks labelled as urgent, but with any real action repeatedly postponed. Now, after the financial implosion, the urgent need to act seems to have become unconditional—with the result that undreamt of quantities of cash were immediately found and then poured into the financial sector without any regard for the old priorities. Do we need further proof, Zizek asks, that Capital is the Real of our lives: the Real whose demands are more absolute than even the most pressing problems of our natural and social world? .”

OK? So get out there and spend, spend, spend!

If you don’t need it buy it anyway.

from Bloomberg.com

Indonesian Stocks May Fall on Cabinet, Citigroup Says

By Berni Moestafa

Oct. 23 (Bloomberg) — Indonesian stocks may enter a “correction” on selling by investors to secure gains from Asia’s third-best rally this year because of concern Cabinet appointees lack economic experience, a Citigroup Inc. unit said.

President Susilo Bambang Yudhoyono named two allies to key economics and energy ministry posts this week. The appointments may be seen as political pandering, compromising the government’s ability to drive growth, said Sunny Yoon, president director of PT Citigroup Securities Indonesia.

The Jakarta Composite index has risen 81 percent this year. Yudhoyono’s re-election in July raised optimism he will maintain policies that have helped the economy expand at the fastest pace since the 1997 Asian financial crisis. He won the polls with 60.8 percent of the 121.5 million valid votes.

“There appears to be a disconnection, why would you produce a compromised Cabinet when you have a clear mandate?” Yoon said in a telephone interview in Jakarta yesterday. “The risk here for the market is that a lot of expectation has been built in for a more professional, technocratic type of Cabinet and it hasn’t happened.”

Global interest rates are set to rebound as inflation accelerates, adding a trigger for investors to “realize gains” in Indonesian stocks, Yoon said. Banking and cement shares are most likely to fall, he said.

Consolidate

The benchmark index may “consolidate” at around 2,300 to 2,400 by year-end, Yoon said. The measure climbed 1.1 percent to 2,459.44 at 3:05 p.m. local time, paring the drop this week to 2.3 percent, the most since Sept. 4.

State Secretary Hatta Rajasa, a member of the National Mandate Party allied to Yudhoyono, was named coordinating minister for economic affairs. Rajasa has “limited economic experience but it’s hoped he’ll be able to provide a political shield for economic ministers under him in the parliament,” said Fauzi Ichsan, chief economist at Standard Chartered Bank Plc in Jakarta.

Darwin Saleh, an economics lecturer and member of Yudhoyono’s Democrat Party, will become energy minister running Southeast Asia’s biggest oil and natural gas industry. He has “insufficient experience in that field,” said Umar Juoro, an economist at the Jakarta-based Center for Information and Development Studies.

No Knowledge

“If you don’t have the knowledge you can’t make decisions, consequently policies won’t work,” said Fadlul Imansyah, a fund manager at Jakarta-based PT PNM Investment Management, which overseas about $148 million in assets. That may hamper Yudhoyono’s efforts to accelerate infrastructure projects needed to boost economic growth, Imansyah said.

Other appointments by Yudhoyono are more likely to reassure investors. He retained Finance Minister Sri Mulyani Indrawati and Trade Minister Mari Pangestu. Sri Mulyani and Pangestu, along with Vice President Boediono, the former head of the central bank, are “most favored by the markets,” said Winang Budoyo, an economist at PT Bank CIMB Niaga.

The Democrat Party, which held 10 percent of parliament during Yudhoyono’s first term, almost tripled its share to 148 seats in April 9 legislative elections, making it the biggest party in the 560-strong body. Yudhoyono’s coalition controls 75 percent of parliament.

Assertive Presidency

“Those that had predicted a more assertive presidency in the second term could start toning down their expectations,” Bank Danamon’s Arman and Anton Gunawan wrote in a note yesterday. “We think the announcement of the Cabinet line-up would at most have a neutral impact for the markets.”

Next year, the Jakarta Composite may advance and exceed its January 2008 record of 2,830.26 points, Citigroup’s Yoon said. He recommends PT Telekomunikasi Indonesia, the nation’s biggest company by market value, as it’s trading at a discount to the market and will benefit from improving consumer demand in 2010.

Consumer spending accounts for about two-thirds of the economy. The government expects growth to accelerate to 5.5 percent next year from an estimated 4.3 percent this year. Bank Indonesia has cut its benchmark interest rate nine times to a record low of 6.5 percent this year, helping Southeast Asia’s biggest economy to avoid recession.

Speculation that the central bank will increase interest rates has intensified with gains in inflation. Consumer prices rose 2.83 percent in September from a year earlier after gaining 2.75 percent in August. That was more than the 2.6 percent increase expected by economists in a Bloomberg News survey.

Bank Indonesia, which kept rates unchanged for a second month on Oct. 5, is scheduled to hold its next policy meeting on Nov. 4.”

from AFP 10.22.09

Indonesia’s new govt targets 7% growth

By Stephen Coates (AFP) – 11 hours ago

JAKARTA — Indonesian President Susilo Bambang Yudhoyono said on Friday his new economic team is targeting seven percent growth by 2014, setting Southeast Asia’s biggest economy back on its pre-crisis trajectory.

On the first full day at the helm of his new cabinet, which was sworn in Thursday after July presidential polls, Yudhoyono also promised the resource-rich country’s wealth would be more evenly distributed.

“In the next five years we’ll be getting back on track. Our target is seven percent or more to improve the livelihoods of the people,” he said in an address to the inaugural session of the new cabinet.

Yudhoyono said his government had yet to work out the details of its plans but promised “development that is inclusive and just” to reduce poverty in the mainly Muslim archipelago of 234 million people.

The government has predicted growth of 4.0-4.5 percent this year, third only to China and India in the G20 club of rich and major developing countries. The economy grew 6.1 percent in 2008.

The local stock market has soared almost 80 percent in 2009, but about half the population continues to live on less than two dollars a day, according to the Asian Development Bank.

Yudhoyono said seven percent growth could have been reached this year but for the global downturn.

“Because of the economic storm, we’ve been set back,” the 60-year-old former general said.

Yudhoyono’s new coordinating minister for the economy, Hatta Rajasa, earlier said that while the government was aiming for seven percent growth by 2014, a longer-term eight percent target was “achievable”.

His comments reflect the view among many investors that Indonesia is poised to join the so-called BRIC nations — Brazil, Russia, India and China — as one of the rapidly growing countries that could dominate the world economy by mid-century.

Yudhoyono was inaugurated Tuesday having won a landslide election victory in July, on promises to fight corruption and boost economic growth.

He has compiled a rainbow coalition of six parties controlling 423 out of 560 seats in parliament, but has come under fire for handing most seats to party-political figures rather than competent experts more likely to improve governance and fight corruption in the world’s third biggest democracy.

The choice of former transport minister Rajasa as economy minister raised some eyebrows, but the all-important posts of finance and trade stayed with incumbents seen as reliable technocrats.

Former International Monetary Fund senior executive Sri Mulyani Indrawati kept the finance portfolio, while Mari Pangestu stayed in charge of the trade ministry, where she has been a steady advocate of open markets.

Indonesia’s financial markets mostly welcomed Yudhoyono’s comments, with the rupiah ending the session higher at 9,435 to the dollar compared with its Thursday close of 9,540. Local stocks closed 1.43 percent in the black.

Standard and Poor’s ratings agency changed its outlook for Indonesia to positive from stable, raising hopes of a credit rating upgrade in 2010.

It said the brighter outlook was supported by an improving public-debt ratio and rising foreign reserves, which hit a record of 62.3 billion dollars on September 30, easing potential external liquidity concerns.

“Notably, these positive trends have not been derailed by the effects of the global financial market and economic turmoil of the past year,” agency credit analyst Agost Benard was quoted as saying by Dow Jones Newswires.”

Jakarta (why I am optimistic)

Jakarta, 2008

The problems we face are dire and it is easy to mark them all out in broad strokes. That there will be trouble ahead I have no doubt. Yet, in these times, the opportunity to make the positive fundamental changes which we need to move forward has never been so clear and the way so open. We are not on the verge of a global Dark Age.

From: Focus on the Global South

10/23/2008

The Global Economic Crisis: An Historic Opportunity for Transformation

 
“An initial response from individuals, social movements and non-governmental Organisations in support of a transitional programme for radical economic transformation Beijing, 15 October 2008

Preamble
Taking advantage of the opportunity of so many people from movements gathering in Beijing during the Asia-Europe People’s Forum, the Transnational Institute and Focus on the Global South convened informal nightly meetings between 13 and 15 October 2008. We took stock of the meaning of the unfolding global economic crisis and the opportunity it presents for us to put into the public domain some of the inspiring and feasible alternatives many of us have been working on for decades. This statement represents the collective outcome of our Beijing nights. We, the initial signatories, mean this to be a contribution towards efforts to formulate proposals around which our movements can organise as the basis for a radically different kind of political and economic order. Please sign on to this statement at http://casinocrash.org/?p=235#comment-345.

The Crisis
The global financial system is unravelling at great speed. This is happening in the midst of a multiplicity of crises in relation to food, climate and energy. It severely weakens the power of the US and the EU, and the global institutions they dominate, particularly the International Monetary Fund, the World Bank and the World Trade Organisation. Not only is the legitimacy of the neo-liberal paradigm in question, but the very future of capitalism itself.

Such is the chaos in the global financial system that Northern governments have resorted to measures progressive movements have advocated for years, such as nationalisation of banks. These moves are intended, however, as short-term stabilisation measures and once the storm clears, they are likely to return the banks to the private sector. We have a short window of opportunity to mobilise so that they are not.

The challenge and the opportunity
We are entering uncharted terrain with this conjuncture of profound crises – the fall out from the financial crisis will be severe. People are being thrown into a deep sense of insecurity; misery and hardship will increase for many poorer people everywhere. We should not cede this moment to fascist, right wing populist, xenophobic groups, who will surely try to take advantage of people’s fear and anger for reactionary ends.

Powerful movements against neo-liberalism have been built over many decades. This will grow as critical coverage of the crisis enlightens more people, who are already angry at public funds being diverted to pay for problems they are not responsible for creating, and already concerned about the ecological crisis and rising prices – especially of food and energy. The movements will grow further as recession starts to bite and economies start sinking into depression.

There is a new openness to alternatives. To capture people’s attention and support, they must be practical and immediately feasible. We have convincing alternatives that are already underway, and we have many other good ideas attempted in the past, but defeated. Our alternatives put the well-being of people and the planet at their centre. For this, democratic control over financial and economic institutions are required. This is the “red thread” connecting up the proposals presented below. …> go to article

Conclusion

These are all practical, common sense proposals. Some are initiatives already underway and demonstrably feasible. Their successes need to be publicised and popularised so as to inspire reproduction. Others are unlikely to be implemented on their objective merits alone. Political will is required. By implication, therefore, every proposal is a call to action.

We have written what we see as a living document to be developed and enriched by us all. Please sign on to this statement at the bottom of the page.

A future occasion to come together to work on the actions needed to make these ideas and others a reality will be the World Social Forum in Belem, Brazil at the end of January 2009.

We have the experience and the ideas – let’s meet the challenge of the present ruling disorder and keep the momentum towards an alternative rolling!!”

You can sign on to support this statement here: The global economic crisis: An historic opportunity for transformation

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Jakarta (CRASH! CRASH! CRASH!)

Another bad day on Wall Street with the DOW down over 7%.  The market is falling like a rock through water.

First it was the Bakrie firms that were halted in trading on the Jakarta Stock Market. Now, Reuters is reporting the entire Jakarta exchange is being closed after having lost 20% of its value in three days (see link above).

Grim times may be ahead but there also will be opportunities. It is those opportunities I am most interested in.  The system has not worked. The system has betrayed us. It is time for something new.

From Adbusters:

Excerpt

Resilience Or Survival

As a consequence of our inaction, we are starting to see the concept of resilience replacing sustainability as a goal.

Many of the new ideas about sustainability and resilience are nothing more than a recognition that the old ways of living are actually good, as seen today in small villages throughout Europe, Mexico, Latin America, Asia and Africa.

In our Western culture of over-consumerism, we have actually missed the opportunity of reaching any kind of sustainability. Perhaps we never have actually understood what that concept is all about. I always thought that the original sustainable development term – which was coined 20 years ago in the 1987 UN report, Our Common Future – was a total oxymoron.

Perhaps the main reason that we never got it, is that such a level of true understanding of what is at stake requires being proactive. We need to think about the implications of our lifestyle, think about consequences.

Yikes, that is too much work, so why bother? It is easier just to keep on BAUing (Business As Usual) and pretend everything is fine.

As a consequence of our inaction, we are starting to see the concept of resilience replacing sustainability as a goal.

Perhaps this is because we are finally realizing that the imminent threats of global warming, climate change, overpopulation, poverty, religious wars, peak oil, food scarcity, etc. are real. So we are now talking about the need to become resilient, to be ready to cope with all the social, economic and environmental changes and challenges that are coming.

Suddenly, a sense of urgency is in the air, and there is talk about local resilience and resilient communities. If we don’t understand these concepts, and make changes necessary for a significantly different way of life, sooner or later we will be forced into facing the next level down: becoming survival communities of sorts.

The diagram tries to graph this idea. We have already missed the sustainability plateau and we are starting the descent. Maybe we can stop the fall at the resiliency plateau. If we can’t, we will then face really difficult times.

Originally published in The Watershed Sentinel, June-July 2008 …>go to article

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Jakarta (KRISMON!)

For Stocks, Worst Single-Day Drop in Two Decades

By MICHAEL M. GRYNBAUM
Published: September 29, 2008

It was the Black Monday of 2008.

Stocks fell by nearly 9 percent on Monday – the worst single-day drop in two decades – after the government’s bailout plan, touted by its supporters as a balm for the current market stress, failed to pass the House of Representatives, setting off a fresh wave of anxious selling.

In yet another day that has shaken the embattled canyons of Wall Street, the Dow Jones industrials fell 777.68 points after it became clear that the legislation could not muster the support it needed to pass the House.

The broadest measure of the American stock market, the Standard & Poor’s 500-stock index, fell 8.77 percent, its biggest drop since October 1987. The Nasdaq composite index fell by more than 9 percent, after the House defeated the bill by a vote of 228-205.

The fear was most pronounced in the world’s credit markets, considered gauges of anxiety among investors. Yields on Treasuries plummeted after the House rejected the plan, with the one-month Treasury note yielding virtually zero. …> go to article

Paul Krugman writes today:

New York Time, September 29, 2008, 3:02 pm

OK, we are a banana republic

House votes no. Rex Nutting has the best line: House to Wall Street: Drop Dead. He also correctly places the blame and/or credit with House Republicans. For reasons I’ve already explained, I don’t think the Dem leadership was in a position to craft a bill that would have achieved overwhelming Democratic support, so make or break was whether enough GOPers would sign on. They didn’t.

I assume Pelosi calls a new vote; but if it fails, then what? I guess write a bill that is actually, you know, a good plan, and try to pass it – though politically it might not make sense to try until after the election.

For now, I’m just going to quote myself:

So what we now have is non-functional government in the face of a major crisis, because Congress includes a quorum of crazies and nobody trusts the White House an inch.
As a friend said last night, we’ve become a banana republic with nukes. …> go to article

Brother, can you spare a rupiah?

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Jakarta (The World Bank, IMF, US debt)

Oh say does that star spangled banner yet wave o’er the land of the free and the home of the brave?

If you think the current KRISMON in the United States does not have global reach, think again. The New York Times reports this morning:

Rescue Plan Seeks $700 Billion to Buy Bad Mortgages

By DAVID M. HERSZENHORN
Published: September 20, 2008

WASHINGTON – The Bush administration on Saturday formally proposed to Congress what could become the largest financial bailout in United States history, requesting virtually unfettered authority for the Treasury to buy up to $700 billion in mortgage-related assets from financial institutions based in the United States.

The proposal was stunning for its stark simplicity: less than three pages, it would raise the national debt ceiling to $11.3 trillion. And it would place no restrictions on the administration other than requiring semiannual reports to Congress, allowing the Treasury to buy and resell mortgage debt as it sees fit.

Staff members from the Treasury Department and the House Financial Services and Senate banking committees immediately began meeting on Capitol Hill, where negotiations were likely to be complicated but quick. Democratic Congressional leaders have pledged to help approve legislation by the end of this week.

The plan, an ambitious effort to transfer the bad debts of Wall Street into the obligations of American taxpayers, was put forward by the administration late last week, after a series of bold interventions on behalf of ailing private firms seemed unlikely to prevent a crash of world financial markets. …> go to article

 The figure of 700 billion dollars is really an open ended question as no one knows the true depth of the problem. But those who run the financial sector in the United States apparently know the answer. Profits are private. Debt is public.  The United States has been living well above its means for a long time. The gap between the rich and the poor is wider than at any other time in our history. In any other country in the world the World Bank and the IMF would show up with a ten point plan for economic recovery.  Indonesians, especially Jakartans, should remember what that looks like. 

Hey U.S., welcome to the Third World!
It’s been a quick slide from economic superpower to economic basket case.

Los Angeles Times, Rosa Brooks
September 18, 2008

“Dear United States, Welcome to the Third World!

 It’s not every day that a superpower makes a bid to transform itself into a Third World nation, and we here at the World Bank and the International Monetary Fund want to be among the first to welcome you to the community of states in desperate need of international economic assistance. As you spiral into a catastrophic financial meltdown, we are delighted to respond to your Treasury Department’s request that we undertake a joint stability assessment of your financial sector. In these turbulent times, we can provide services ranging from subsidized loans to expert advisors willing to perform an emergency overhaul of your entire government.

As you know, some outside intervention in your economy is overdue. Last week — even before Wall Street’s latest collapse — 13 former finance ministers convened at the University of Virginia and agreed that you must fix your “broken financial system.” Australia’s Peter Costello noted that lately you’ve been “exporting instability” in world markets, and Yashwant Sinha, former finance minister of India, concluded, “The time has come. The U.S. should accept some monitoring by the IMF.”

We hope you won’t feel embarrassed as we assess the stability of your economy and suggest needed changes. Remember, many other countries have been in your shoes. We’ve bailed out the economies of Argentina, Brazil, Indonesia and South Korea. But whether our work is in Sudan, Bangladesh or now the United States, our experts are committed to intervening in national economies with care and sensitivity.

We thus want to acknowledge the progress you have made in your evolution from economic superpower to economic basket case. Normally, such a process might take 100 years or more. With your oscillation between free-market extremism and nationalization of private companies, however, you have successfully achieved, in a few short years, many of the key hallmarks of Third World economies.

Your policies of irresponsible government deregulation in critical sectors allowed you to rapidly develop an energy crisis, a housing crisis, a credit crisis and a financial market crisis, all at once, and accompanied (and partly caused) by impressive levels of corruption and speculation. Meanwhile, those of your political leaders charged with oversight were either napping or in bed with corporate lobbyists.

Take John McCain, your Republican presidential nominee, whose senior staff includes half a dozen prominent former lobbyists. As he recently put it, “I was chairman of the [Senate] Commerce Committee that oversights every part of the economy.” No question about it: Your leaders’ failure to notice the damage done by irresponsible deregulation was indeed an oversight of epic proportions.

Now you are facing the consequences. Income inequality has increased, as the rich have gotten windfalls while the middle class has seen incomes stagnate. Fewer and fewer of your citizens have access to affordable housing, healthcare or security in retirement. Even life expectancy has dropped. And when your economic woes went from chronic to acute, you responded — like so many Third World states have — with an extensive program of nationalizing private companies and assets. Your mortgage giants Fannie Mae and Freddie Mac are now state owned and controlled, and this week your reinsurance giant AIG was effectively nationalized, with the Federal Reserve Board seizing an 80% equity stake in the flailing company.

Some might deride this as socialism. But desperate times call for desperate measures.

Admittedly, your transition to Third World status is far from over, and it won’t be painless. At first, for instance, you may find it hard to get used to the shantytowns that will replace the exurban sprawl of McMansions that helped fuel the real estate speculation bubble. But in time, such shantytowns will simply become part of the landscape. Similarly, as unemployment rates continue to rise, you will initially struggle to find a use for the expanding pool of angry, jobless young men. But you will gradually realize that you can recruit them to fight in a ceaseless round of armed conflicts, a solution that has been utilized by many other Third World states before you. Indeed, with your wars in Iraq and Afghanistan, you are off to an excellent start.

Perhaps this letter comes as a surprise to you, and you feel you’re not fully ready to join the Third World. Don’t let this feeling concern you. Though you may never have realized it, you’ve been preparing for this moment for years.” …> go to article

 As all this is going on Houston, Texas, the forth largest city in the United States is still larely without electricity and drinking water due to Hurricane Ike which caused an estimated $20 billion is damages.  People are standing in four mile long lines for food and living in tents. The stench in Galveston is nearly unbearable. Compared to the current situation in Houston, Jakarta appears as a holiday get-away destination. And New Orleans has yet to fully recover from Hurricane Katrina.  The United States in engaged in two wars, one of which is costing $10 billion a month. 

And everything is being financed by debt.

Henry Paulson is now President, elected in a secret closed door meeting.  The US Treasury Department is now running the United States taking its marching orders from the Federal Reserve. 

All of this is far from over and whatever the outcomes, which I assure you will not be pleasant, they will have global implications.

 

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Jakarta (informal) part 2

Photo by Quiseng 

Economics is the social science that studies the production, distribution, and consumption of goods and services. The term economics comes from the Greek for oikos (house) and nomos (custom or law), hence “rules of the house(hold).” …> go to site

Economics at its most basic might be thought of as the ways in which we make a living. The economy can also be described in terms  of the relationships between supply and demand.

 The rules of the household (a few examples)

Begging

One evening while taking the new communter train from Jakarta to Depok with my friend Budi I noticed a man several cars down crawling along the floor of the train carriage. He would stop occasionally and collect a few coins or rupiah form the commuters. Others ignorded him.  As he approached where we were sitting I reached into my pocket for the stack of coins which I had been accumulating through the day.  He held out his hand and I gave him the coins.  Budi did nothing. The man moved on.  Budi then told me, “Maybe if you follow him home you will see what a nice house he lives in“.  I took this to mean that the man was either faking his disability or he was some sort of professional beggar working his audience.  Shortly after that the train made a stop and a young blind man with his mother walked on board.  He had strapped on his back a small portable karioki machine and proceeded to sing into his microphone with a very good voice.  At this Budi reached into his pocket and handed over his coins.  Budi could tell the difference.  I could not. It is still hard to this day.

There are an estimated 200,000 street vendors in Jakarta each month they pay out about $1.5 billion rupiah for protection, in extortion, or for illegal fees. There are perhaps 80,000 street kids who make their living by begging.

In Spetmeber 2007, the Jakarta City Council approved a bylaw that bans busking, begging and street hawking as well as banning people from giving money to beggars, vendors and hawkers.

Initiated by the city’s departing governor, Sutioyoso, the bylaw says that anyone who is caught giving money to beggars, and others of their ilk, will be fined of 50 million rupiah.From World Street Children News …>go to site 

Mohammad Yazid, Jakarta

“A beggar recently scolded my wife for refusing to give him some money at a busy intersection in Cempaka Putih (famously known as Coca-Cola intersection), Central Jakarta.

“How stingy, so what’s the headscarf for?” he said to my wife. I told my wife not to roll down the car window because I was afraid he was a crook.

Bluffing and smirking have become forms of pressure exerted by beggars operating at nearly every crossroad in Jakarta.

They employ various other methods at other places such as public transportation and residential areas. Some use the conventional style of pretending to be starving or seriously ill, while others apply the criminal way of extorting money from passengers by appearing as alcoholics or newly released convicts.

Women have an effective trick of approaching benevolent people and exploiting the innocent looks of children under the age of five and carrying “hired infants” at Jakarta intersections.

There is no official data on the total number of beggars in Jakarta, but according to Suciardi, head of the commercial sex rehabilitation service at the Jakarta Social Welfare Office, their numbers increase by 40 percent during Ramadhan through Idul Fitri, from the 2,295 normally found in the city.

Chairman of the National Commission for Child Protection, Seto Mulyadi, said the number of street children in Greater Jakarta reached 80,000.

Amid the prevailing economic difficulties and different mishaps affecting Indonesia, many people choose begging as their profession, because they often make more than those who work at government offices or private businesses. Earning about Rp 50,000 to Rp 75,000 daily on average, in a month a beggar can make Rp 1.5 million, far more than Jakarta’s minimum wage of Rp 900,000″.

 Black Markets

Begging, of course, is small change compared to Jakarta’s black markets. Havoscope Global Black Market Indexes lists  the market value of Indonesia’s black market at $3.32 billion (US). The counterfeit goods market value (books, cable, music, movies, and computer software) is listed at $458 million (US).  Black market handphone sales may be as high as $370 million (US). The value of the illegal drug trade is not listed but may also be in the millions of dollars as is indicated by the  recent incident of 600,000 ecstasy pills seized from a shop-house in Cengkareng, Tangerang district, Banten province, last February 26.

Human Trafficking

 from Human Trafficking.org

“Indonesia is primarily a source, but also a transit and destination country for human trafficking. UNICEF estimates that 100,000 women and children are trafficked annually for commercial sexual exploitation in Indonesia and abroad, 30 percent of the female prostitutes in Indonesia are below 18, and 40,000-70,000 Indonesian children are victims of sexual exploitation. The East Java Children’s Protection Agency estimates that at least 100,000 women and children are trafficked annually from, through, and to East Java.

Indonesian women and children are trafficked for sexual and labor exploitation in Malaysia, Singapore, Brunei, Taiwan, Japan, Hong Kong, and the Middle East.  A significant number of Indonesian women voluntarily migrate to work as domestic servants but are later coerced into abusive conditions. Some Indonesian women are recruited by false promises of employment and are later coerced into prostitution or forced labor. Ethnic Chinese women and teenage girls in the West Kalimantan district are recruited as mail-order brides for men in Taiwan, Hong Kong, and Singapore.

Indonesian women from the Riau Islands, Bali, and Lombok are used for sex tourists from Malaysia and Singapore”.

 from Fact book on Global Sexual Exploitation – Indonesia

“A 1992 survey showed that one out of 10 prostituted persons was under age 17, and that one out of five of those older than that age said they took up prostitution before they reached 17. Dario Agnote, “Sex trade key part of S.E. Asian economies, study says,” Kyodo News, 18 August 1998

The sex industry accounts for an estimated 1.2 billion dollars to 3.3 billion dollars in annual earnings, or between 0.8 and 2.4% of the country’s GDP, the study said. In Jakarta alone, prostitution-related activities are estimated to be worth 91 million dollars annually. Dario Agnote, “Sex trade key part of S.E. Asian economies, study says,” Kyodo News, 18 August 1998

There are between 140,000 and 230,000 prostituted persons in Indonesia (1993-1994 estimates). Prostituted persons are mainly adult women, but there are also male, transvestite and child prostitutes, both girls and boys. International Labor Organization. Dario Agnote, “Sex trade key part of S.E. Asian economies, study says,” Kyodo News, 18 August 1998

There are at least 650,000 prostitutes in Indonesia. In 1998 there were 150,000 registered prostitutes compared to 72,000 in 1995. 30 percent are children. (Yogyakarta Free Children Society, Mohammad Farid, “Indonesian economic crisis boosts prostitution,” Reuters, 26 July 1998

There were 65,582 registered prostitutes in 1994. The highest estimate is 500,000 women in prostitution. CATW – Asia Pacific, Trafficking in Women and Prostitution in the Asia Pacific

About 200 prostituted women in Jakarta, Indonesia, protesting plans by the mayor to close down their complex carried signs stating “I did not want to become a prostitute. The economic difficulties have made me a prostitute.” “Indonesian prostitutes join wave of protests,” Reuters, 2 July 1998

Earnings from prostitution average $600 a month in Indonesia and are higher than in other unskilled jobs. International Labor Organization, Elif Kaban, “UN labour body urges recognition of sex industry,” Reuters, 18 August 1998

Particularly because of the economic crises in Asia, women in Thailand and Indonesia are increasingly forced into prostitution as the only means of survival. “Women Workers Are Last in, First Out,” Associated Press, 30 April 1998

In Indonesia the economic crisis has driven thousands of women into prostitution for economic survival. Although “streetwalkers” are prohibited in Jakarta, there is no law prohibiting the sale of sexual services. Yogyakarta Free Children Society, Mohammad Farid, “Indonesian economic crisis boosts prostitution,” Reuters, 26 July 1998

The sex industry takes in US$ 1.2 – US$ 3.6 billion. CATW – Asia Pacific, Trafficking in Women and Prostitution in the Asia Pacific

The city of Surbaya, with tens of thousands of prostitutes, is the largest sex industry center in South East Asia, which consists of hectares and hectares of modest houses with large, plate-glass windows where bored girls sit waiting: “streets full of human aquariums”. It is also a magnet for the divorced and dispossessed women of the strict Islamic villages. The sex industry serves as a source of women for prostitution in provincial towns, through a black market network of pimps. Louise Williams, “Sex in the Cemetary,” Sydney Morning Herald, 25 January 1997

30% of the girls in Semarang, Indonesia who are homeless are forced into prostitution for survival. University Diponegoro study, Nicholas D. Kristof “Asian Crisis Deals Setbacks to Women”.

Other sites (grim and enlightening) addressing this issue are at:

 Child Prostituion - Indonesia

Intersections: Traditional and Emergent Sex Work in Urban Indonesia

Then there are these sites. 

Best Ladies Escort Agency in Jakarta

Travel Sex Guide Indonesia

Jakarta After Dark

And…finally

from AFP Penises and Prayer Mats: Its Sexual Healing Indonesian Style

“A consultation with Haji Baban is an encounter with the arcane. Sitting cross-legged in semi-darkness, the patient is asked to detail his wishes with the visual aid of a selection of carved wooden phalluses.

Then comes the diagnosis, delivered after a contemplative silence.

Solemnly, Haji Baban intones that the client’s appendage is “fairly average,” and offers to conjour up a six-centimetre (2.3-inch) extension.

The prescription for such whopping growth is a 10-day course of eating and drinking mystery concoctions and secret potions, with the first dose of bitter berries to be taken immediately, washed down with dark brown liquid.

An assistant then brings a phallus-shaped bamboo tube containing a roll of sticky coconut rice that has to be swallowed whole to avoid what Haji Baban describes ominously as “terrible genital consequences”.

Haji Baban ends the consultation with a vegetable oil that the client must promise to apply daily with a specific hand action from base to tip. And no eating green bananas or citronella, he orders.

The daily cost for treatment is between 700,000 and one million rupees (70-100 dollars), depending on the options selected.

This is a hefty sum for many in Indonesia but the imposing mansions being built around Caringin seem to indicate that plenty of men are willing to pay.

A local motorcycle taxi driver gestures to the newly-built homes and says: “They belong to Mak Erot.”

A Last Note

From begging to the black market to human trafficking to penis enlargement. Such are the rules of the Indonesian household. 

I suppose I should be editorializing or moralizing at this point.  In this post I have moved from  the lighter side (is there one?) to the darker side (most certainly there is one) of the informal economies of Jakarta.   I now see that this was sort of an inevitable progression. As it is with all households everything is connected to everything else. It is there in the tension between the rich and poor, the politics and economics of gender, the educated and the uneducated, those with power and those who are disenfranchised. 

As Mary S. Zurbuchen writes in Images of Culture and National Development in Indonesia: The Cockroach Opera, “if the poor of Jakarta are like cockroaches, then these purportedly disgusting insects, instead of signifying filth and being driven from sight, must be welcomed. Victorious and pervasive, they persist everywhere, from the sprawling marbel villas of luxury housing estates like Pondok Indah to the immense slums of Tanjung Priok. The roach should not be counted a symbol of the lowlife here but rather a ubiquitous survivor of thousands of fantasies of ultimate extermination”.   

And still, time after time Susan Abeyasekere’s words from Jakarta: A History just won’t go away, “the central fallacy [of Jakarta] which has persisted from 1619 to the present is that it is possible to create a city for the privileged few, cut off from the countryside and the majority of the poor”.  

This goes to the who, what, why, and where of Jakarta’s informal economies. And it is clear, as the reality of the city declares,  that it is not possible to create a city for “the privileged few”.

It is true for Jakarta as it is for any place else you can point to on the planet.