An Imperial Transition. posted by Richard Seymour

This is John Pilger's documentary, 'The New Rulers of the World':



And this is an earlier one, 'Death of a Nation':



The first one talks at some length about how Indonesia was first destroyed by a coup supported by Britain, which perceived a threat in Sukarno's independent nationalism to its massive interests in South East Asia, and the United States. Foreign Office files in 1964 called for the 'defense' of South East Asian interests, which produced "nearly 85 percent of the world's natural rubber, over 45 percent of the tin, 65 percent of the copra and 23 percent of the chromium ore." Harold MacMillan and John F Kennedy had agreed in 1962 to "liquidate President Sukarno, depending on the situation and available opportunities". He had led the nationalist revolt against Japanese occupation, declared independence in 1945, fought a British-backed attempt by the Netherlands army to re-occupy the territories, and was encouraging the development of mass trade unionism and peasant organisations, tolerating the development of a mass communist party (the PKI) which was by far the largest party in Indonesia. So, in 1965, Suharto and a clique of generals raised alarm about an alleged communist plot to take over the government, claimed that six generals had been murdered by the PKI, and launched a wave of terror with lists of dissidents provided by officials in the US and British embassy. The American ambassador, Marshall Green, congratulated Suharto and assured him that the US was "sympathetic with and admiring of" the genocide. The US embassy coordinated a propaganda campaign with the britishy embassy, intended to spread the story of PKI guilt, treachery and brutality. Roland Challis, the BBC's South-East Asia correspondent at the time, tells Pilger of how "there were bodies washing up on the lawns of the British consulate in Surabaya, and British warships escorted a ship full of Indonesian troops down the Malacca Straits so that they could take part in this terrible holocaust". The Australian Ambassador, Harold Holt, chuckled at the time that, with "500,000 to a million communist sympathisers knocked off", it was "safe to assume a reorientation has taken place".

So much you know. What followed was an archetypal instance of imperial transition. A client-regime thus installed, the IMF and World Bank returned to Indonesia, and then there was a conference in Geneva, in which the economy of Indonesia was devised in the fullest detail, with representatives from the new dictatorship working alongside the representatives of the biggest capitalist firms in the world: General Motors, BAT, American Express, Siemens, Goodyear etc etc. The conference took as its starting point a plan devised on behalf of USAID by Harvard economist Dave Cole, who had recently reconfigured South Korea's banking regulations on behalf of Washington. He worked as part of a team sent to Indonesia after the coup by the Ford Foundation. And with that plan in mind, they devised, sector-by-sector, the legal infrastructure for each sector of industry according to the requirements of investors. Bauxite, nickel, copper, the tropical forests of West Papua - all were rich pickings. The basic structure of the economy continued to be determined by Western capital and state in collaboration with Suharto through the Intergovernmental Commission on Indonesia.

Bear with me for a second. The next documentary details the genocidal take-over of East Timor, which had recently declared independence from Portugal. The Portuguese empire was collapsing: African wars of liberation had been draining the oligarchy, whose perpetuation depended upon its strategy of maintaining overseas possessions and growth via export to the colonies. Between 1960 and 1974, its exports to the colonies fell from 34% of all exports to 15%. Trade within the EEC was increasingly important to Portugal, which meant that it was also affected by the global downturn in the early 1970s, and faced staggering rates of inflation. Its version of state corporatism was incompatible with the needs of international investors. At the same time, growing domestic working class revolt was ably harnessed by the Armed Forces Movement in what has been called the Carnation Revolution. Initially, the conservative General Spinola was ceded control by the deposed Caetano. Spinola, who had previously been stridently opposed to nationalist demands, came to articulate the concerns of a growing number of leading capitalist families when he urged that Portugal should not "cast Europe aside". He resigned in disgust at the leftist direction of the revolution, particularly the nationalisation of key industries and the support for decolonisation, and tried to mount a pathetic rightist coup against it. And - well, he lost, and look, what happened next within Portugal is a matter for another post. The point here is that with all that going on, a mass independence movement had developed in what was then Portuguese Timor. By far the largest party in that revolt was the leftist Fretilin.

The big worry for the British, the Australians, and the US, as you'll see in the documentary, was that an independent East Timor with a government of the left would emerge. As in Mozambique and Angola, the US would end up shouldering a big part of the white man's burden that the Portuguese had dropped so inceremoniously. So, they stumped up a huge amount of aid to Suharto so that he could invade, with Kissinger organising a criminal conspiracy within the State Department to continue arming the dictatorship. The TNI wasted no time: they killed about 200,000 people, tortured and mutilated others, carried out repeated massacres and atrocities, and launched a genocidal programme of forced contraception. It was not uncommon to find that people had died by being stripped, hung upside down by the feet, castrated and finally having their genitals shoved into their mouths. It took a long time to die that way, either by bleeding or asphyxiation. As in the insurgent regions of Aceh and West Papua, the TNI never preferred subtlety in its suppression of the East Timorese. And, as with similar regimes in South Korea or Burma, the Western powers stridently defended a policy of sending guns and butter to the murderers.

Well, I expect you know that much too. But what next? Pilger's documentary was made in 1994, before the dramatic revolt by students and workers in 1998. It successfully overthrew Suharto but not the capitalist arrangements that he was there to guarantee, and the TNI remained central to the state apparatus. But the revolt also won a limited form of representative government, and Habibie promised in its wake to allow a referendum in East Timor.

The revolution had compounded growing pressure from international solidarity campaigns to allow independence for East Timor. Jose Ramos-Horta, a rather cool-looking dude in 1975, had become mainstream enough to be awarded the same Nobel peace prize that Henry Kissinger had been awarded. Bespectacled and besuited, the Foreign Minister in exile was making diplomatic overtures to Washington. Xanana Gusmão had become a centrist, and an opponent of Fretilin, which was at any rate moving away from its commitment to socialism. He won the Sydney Peace Prize. (One of the things I like about Dita Sari is that when Nike hypocritically tried to give her a human rights award, she told them where to stick it). Portugal, the former colonist, was on their side too, and Ramos-Horta is careful in the documentary to shower praise on the empire that he had once resisted. The National Council of Timorese Resistance, a coalition of the main political parties, went to great lengths to assure oil and gas interests that they would not suffer from East Timorese self-determination.

Whatever inroads Ramos-Horta made with his approach, it was clear that the world's powers made inroads with him too: East Timor would go into the care and tending of the United Nations. There would be a referendum on independence, and then, if independence commanded support, a UN administration. Of course, the independence vote was won overwhelmingly, and the TNI responded with a terror campaign. And the TNI, whatever else had gone down, were still supported by Washington. The TNI launched what looked like a last-minute attempt at a final, genocidal solution to the East Timorese problem, driving about half of the population out of their homes, killing thousands (with weapons stamped 'Made in the United Kingdom'), and raping with impunity. Hundreds of thousands of people were left starving and dying in squalid refugee camps. You might remember this - it was not long after the West has fought a 'humanitarian' war in Kosovo, the one that so many liberals and former lefties wet their pants over. Eventually, Washington told the Indonesian regime that it should leave East Timor, and threatened it with the suspension of loans and military aid if it did not do so. The TNI duly left, and (mainly Australian) INTERFET forces were sent in to do some reconstruction and launch the UN administration.

Now, if the United States government had decided that an independent East Timor was no longer likely to be a threat, it wasn't particularly enthusiastic about its new strategy either, for it only stumped up a small portion of the cash for the INTERFET forces after considerable delay. Further, senior figures in the US political establishment had been unhappy about the whole idea of East Timor being allowed independence, asserting that it would result in tribal civil war (Paul Wolfowitz was most emphatic on this point).

Nevertheless, any misgivings they might still have had about Fretilin, who were elected with 57% of the vote in the UN-run 2001 ballot for a Constituent Assembly, pressed ahead with a National Development Plan devised in collaboration with USAID, and managed alongside the World Bank through the Transitional Support Programme. That plan involves the usual policy prescriptions of neoliberalism: private sector growth, macroeconomic stability through counterinflationary measures and a balanced budget, and 'independent' financial institutions. Important has been the development of land title and registration laws, designed to instill capitalisation and prevent the widespread development of common ownership. USAID notes with concern that East Timor is failing on "'economic freedom' ... Inflation is reasonable at 4% and fiscal policy prudent, with a
deficit at 2.16% of GDP. However, East Timor clearly fails the indicators for regulatory policy and credit rating and is lacking statistical information for trade policy and days to start a business." Naturally, USAID intends to help.

Further, if there were any lingering doubts, they had Ramos-Horta's slightly equivocal backing for the war. (He at first wrote in the New York Times that the war would liberate Iraqis, then explained that he actually didn't mean quite what he seemed to have meant, then in 2004 berated the Spanish for pulling out of Iraq like chickenshits, and is now a fairly measly apologist).

Finally, there was the coup this year against the elected Prime Minister, a slightly left-leaning 'economic nationalist' named Mari Alkatiri, who was overthrown following riots instigated by one half of the army establishment. It was a clear attempt to prevent the functioning of the government and precipitate its downfall. Alkatiri had engaged the soldiers in negotiations and offered subsidised pay - nevertheless, the riots continued. President Gusmao repeatedly demanded Alkatiri's resignation, while Ramos-Horta insisted he could not work with such a man. Other government ministers suggested that this could not be allowed to happen as it would bring down the government. So, Ramos-Horta 'requested' troops from Australia, who were positioned in the Timor Sea (without the permission of the East Timorese government) awaiting precisely that moment: they launched Operation Astute, siezing the airport and flooding the country with more troops than are in East Timor's tiny army. Just as Australian troops had been said to have been behind some of the protests, the Australian Broadcasting Corporation reported that an Australian army Black Hawk helicopter had accompanied a convoy of anti-Alkatiri protesters. Naturally, the Murdoch press has been delighted by the Australian military's intervention, with The Australian's disgusting foreign editor Greg Sheridan (a long-time apologist for Suharto) accusing Alkatiri of running a quasi-dictatorship with a clique of Marxist-Leninists and so on. Now, Alkatiri was by most standards a centrist, and he had been involved in devising the National Development Plan with its neoliberal policy prescriptions. What earned him this contempt from the Murdoch sewer press may have included his extremely moderate policies, in which he preferred fiscal austerity to World Bank loans, removed fees for school dinners, opposed the privatisation of electricity, and invited Cuban doctors to do some very popular health work in the rural areas. But, perhaps most important was his role in securing better rights for Timor over Australia with regards the very rich oilfields in the Timor Sea.

ABC's reporter referred to the putch as "a very impressive show of people power". Rumours, obviously unsubstantiated, were put about that Alkatiri had planned a hit squad to finish off his political opponents: he'd have needed one that could visit and penetrate every government building in every main Western capital. Several senior government figures, including the Interior Minister and the Defense Minister, resigned. Ramos-Horta took control of the Ministry of Defense, and Gusmao declared an emergency government for one month, with the Prime Minister's powers severely reduced. Eventually, on 22nd June this year, Gusmao declared an ultimatum, eventually forcing Alkatiri to quit. Ramos-Horta was made Prime Minister, and goodbye to 'economic nationalism'. The irony is that Alkatiri was too left-wing for the new Fretilin leadership, the Australian government and the scum press: but one of his big supporters during the crisis was precisely the World Bank, who were very pleased with his cautious to development.

Note the arc of transition: direct colonial rule, replaced by a brutal client-regime, followed by a heavily supervised 'independence' with neoliberal ideology entrenched in the culture of the state, and constant 'remedial' intervention to keep things on the straight and narrow. Hardly a microcosm, but certainly a pattern often repeated.