Rampart Vol. 9 No. 4. October 1970
The Berkeley Mafia and the Indonesian Massacre
By David Ransom
Indonesia, which in the past fired the imagination of fortune-hunters and adventures as the fabled East Indies, was long regarded as "the richest colonial prize in the world." Harking back to such times, Richard Nixon described in 1967 as "the greatest prize in the Southeast Asian area." Not too many years earlier, however, the prize had been thought all but lost to the fiery nationalist Peking-oriented Sukarno and the three million-strong Indonesian Communist Party waiting in the wings. Then in October 1965 an unsuccessful coup and a swift move by Indonesia's generals immobilized the leader and the precipitated the largest massacre in modern history, in which from 500,000 to a million unarmed communists and their peasant sympathizers were killed. When the bloodletting was over, the immense nationalist spirit of a decade had vanished, and the Indies' vast natural treasures were opened by the new regime to U.S. oil companies and corporations.
cut the ribbon on the Indonesian side was an extraordinary team of economic
ministers known to insiders as "the Berkeley Mafia." Sporting
PhDs from the University of California [at Berkeley] and acting as a closely-knit
clique in the councils of power, these men shaped the post-nationalist
policies of the new regime. Behind their rise to eminence and power lay
a saga of international intellectual intrigue, of philanthropoids and
university projects, of student Generals and political Deans, and a sophisticated
imperial design beyond Cecil Rhodes's wildest dreams.
A Dean is Born
Japan's defeat in World War II, wars of national liberation raged in China
and Vietnam. Meanwhile, far away in Washington offices and New York living
rooms, Indonesian independence was being sensibly arranged. By 1949, the
Americans had persuaded the Dutch that if they took action before the
Indonesian revolution went the way of China, they could learn to live
with nationalism and like it. And sure enough, in that year the Indonesians
accepted an independence agreement, drafted with the help of friendly
American diplomats. It maintained the severely was-weakened Dutch economic
presence, while swinging wide the Open Door to U.S. cultural and economic
influences as well.
Among those handled the diplomatic maneuvers in those years were two young Indonesian aristocrats: Soedjatmoko,* called Koko by his American friends, and an economist and diplomat named Sumitro Djojohadikusumo. Both were members of the upper-class, nominally socialist PSI (Partai Sosialis Indonesia), one of the smaller and more Western-oriented of Indonesia's myriad political parties.
New York the two were lionized by a group closely linked to the notorious
Vietnam lobby which shortly thereafter launched Ngo Dinh Diem on his meteoric
career in U.S.-Vietnamese politics. The group, which included Norman Thomas,
was composed of members of the Committee for Independence of Vietnam and
the India League. It occupied as something of a vanguard position among
socialist anti-communists. "We were concerned that the United States
not be caught flatfooted in the post-war necessity to create non-communist
governments in Asia," explains League member, Park Avenue attorney
and legal counsel for Indonesian in the U.S., Robert Delson.
by Indonesia's peppery nationalist leader Sukarno and the strong left
wing of the Independence forces, the Americans found that, as with Diem
in Vietnam, the rather bland nationalism of "Koko" and Sumitro
offered a most palatable alternative. In Council on Foreign Relations
parlance, they were interested in "modernizing" Indonesia, not
revolutionizing it. At Ford-funded School of Advanced International Studies
in Washington in early 1949, Sumitro explained that his kind of socialism
included "free access" to Indonesian resources and "sufficient"
incentives for foreign corporate investment.
independence came later that year, Sumitro returned to Jakarta to become
Minister of Trade and Industry in the coalition government and then, in
two later cabinets, Minister of Finance. As the Minister through the early
'50s, Sumitro defended an economic "stability" that favored
Dutch investments. Carefully eschewing radicalism, he appointed as advisor
the German Hjalmar Schact, economic architect of the Third Reich.
was supposed by the PSI and their numerically stronger "modernist"
ally, the Masjumi Party, a vehicle of Indonesia's commercial and landowning
santri Moslems. But he was clearly swimming against the tide. The Communist
PKI, Sukarno's PNI, the Army, the orthodox Moslem NU-everybody, in fact,
but the PSI and Masjumi-were riding the wave of post-war nationalism.
In the 1955 national election-Indonesia's first and last-the PSI polled
a miniscule fifth place. It did worse in local balloting of 1957, in which
the Communist PKI emerged the strongest party.
when Sukarno started nationalizing Dutch holdings in 1957, Sumitro joined
Masjumi leaders and dissident Army commanders in the Outer Island Rebellion,
supported briefly by the CIA. It was spectacularly unsuccessful. From
this failure in Sumatra and the Celebes, Sumitro fled to an exile career
as government and business consultant in Singapore. The PSI and the Masjumi
America's Indonesian allies had colluded with an imperialist power to overthrow a popularly elected nationalist government, headed by a man regarded as the George Washington of his country-and they had lost. So ruinously were they discredited that nothing short of miracle could ever restore them to power.
miracle took a decade to perform, but now Sumitro has risen once again.
He serves Minister of Trade in a new Indonesian government. And he is
no longer an odd man out: today he is regarded as the number two man in
Indonesia, and he and his comrades are firmly in control.
The "modernist" restoration was not imposed by American troops. The secular arm of American imperium reached into Indonesian politics, often under the cloak of the CIA. But it was the hallowed private institutions of academia and philanthropy that worked the greatest wonders. For Sumitro had not simply been a minority politician and cabinet minister, but since 1951 Dean of the Faculty of Economics at the University in Jakarta. There he marshaled the young men with whom he planned to implement his program for Indonesia; there the Ford Foundation made common cause with him to do so.
interest in Indonesian education began in the early '50s, but it was the
Rockefeller Foundation that had pioneered the area. Just before he left
the Far East section of the State Department in 1952 to become the Rockefeller
Foundation's president, Dean Rusk explained the purpose behind the program.
"Communist aggression" required not only that Americans be trained
for work in the Far East, but that "we must open our training facilities
for increasing number of our friends from across the Pacific."
head of the Ford Foundation, Paul Hoffman, who launched Ford's program
in educational internationalism, was no stranger to the Indonesia situation.
As head of the Marshall Plan in Europe he had cut off Marshall Plan funds,
which were vital to the Dutch counter-insurgency effort, and thus assisted
the birth of the first pro-U.S. Indonesian government. The Dutch themselves
had practiced "indirect rule" in the Indies by simply adding
their own administrators to the top of the existing aristocratic-administrative
hierarchy (from which Sumitro's PSI was derived). As America supplanted
the Dutch, Hoffman's Ford team laid the basis of a post-independence national
bureaucracy trained to function under the "new indirect rule of America-in
Ford's words, to train a "modernizing elite."
With the services it purchased from America's top universities,, Ford manage to create a tough, sophisticated infrastructure that reached into every major institution of Indonesian society. Students selected and molded by the Americans, trained in essential disciplines and skills, became in effect a paragovernment, representing the old PSI-Masjumi parties, but in reality far stronger than they.
launched its effort to make Indonesia a "modernizing country"
in 1954 with field projects out of MIT and Cornell. The scholars produced
by these two projects-one in economics, the other in political development-have
since effectively dominated the field of Indonesian studies in the United
States. Compared to what they eventually produced in Indonesia, however,
this was a fairly modest achievement. Working through the Center for International
Studies (the CIA-sponsored brainchild of Max Millikan and Walt W. Rostow),
Ford put together an MIT team to discover "the causes of economic
stagnation in Indonesia." An interesting example of the effort was
Guy Pauker's study of "political obstacles" to economic development,
such as armed insurgency. Domination of natural and cultural resources
by foreign institutions like Ford would be somewhat outside the theoretical
framework of Pauker's Harvard training.
the course of his field work, Pauker-an urbane and egocentric man-got
to know the high-ranking officers of the Indonesian Army rather well.
He found them "much more impressive" than the politicians. "I
was the first who got interested in the role of the military in economic
development," Pauker says. He also got to know most of the key civilians:
"With the exception of a very small group," Pauker says, they
were almost " totally oblivious" to what he called modern development.
Not surprisingly, the "very small group" was composed of PSI
aristocrat-intellectual, particularly Sumitro and his students.
in fact, had participated in the MIT team's briefings in Cambridge. Some
of Sumitro's students were also known by the MIT team, having attended
a CIA-funded annual seminar run each summer at Harvard by Henry Kissinger,
now President Nixon's top foreign policy strategist. One of them was Mohamed
Sadli, son a well-t-do santri trader, with whom Pauker became good friends.
In Jakarta, Pauker had struck friendships with members of PSI clan and
had formed a political study group among them, whose members included
the head of Indonesia's National Planning Bureau, Ali Budiardjo, and his
wife Mirriam, "Koko's" sister.
1954 Ford grubstaked a Cornell Modern Indonesia Project with $224,000.
With that money, program chairman George T. Kahin has built the social
science wing of the Indonesian studies establishment in the United States.
In Indonesia, Cornell's elite-oriented studies are what the universities
use to teach post-Independence politics and history.
the several Indonesians brought to Cornell on Ford and Rockefeller grants,
perhaps the most influential, is sociologist-politician Seloseomardjan.
Selosoemardjan is right-hand man to the Sultan of Jogjakarta, one of the
strong men of the present Indonesian regime.
with Widjojo Nitisastro, Sumitro's leading protégé, Kahin
set up an Institute to publish the Village studies. It has never amounted
to much, except that its American advisors helped Ford maintain in contact
in the most difficult of the Sukarno days.
and Cornell made contact, collected data, and built up expertise. It was
left to Berkeley actually to train most of the key Indonesians who would
seize the government power to put their pro-American lessons into practice.
Dean Sumitro's Faculty of Economics provided a perfect academic boot camp
for these political shock troops.
oversee the project, Ford President Paul Hoffman tapped his old friend
Michael Harris, a one-time CIO organizer who had headed Marshall Plan
programs under him in France, Sweden, and Germany. In the words of one
Berkeley professors and close acquaintance, Harris was "a typical
Lovestone kind of guy-the labor leader who makes a career out of anti-communist
activities working with the government." Harris had been on a Marshall
Plan survey in Indonesia in 1951, knew Sumitro, and before going out was
extensively briefed by Sumitro's New York promoter, the Indonesian counsel
Delson. Harris reached Jakarta 1955 and set out to build Dean Sumitro
a brand new Ford-funded graduate program in economics.
This time the professional touch and academic respectability were to be provided by Berkeley. The Berkeley team's first task was to replace the Dutch professors whom Sukarno was phasing out and to relieve Sumitro's Indonesian junior faculty so that Ford could send them back to Berkeley for advanced credentials. Already at Berkeley was Sadli, who shared a duplex with MIT's Pauker. Pauker had come to head the new center for South and Southeast Asian Studies on his way to RAND and the CIA. Sumitro's protégé Widjojo led the first crew out to Berkeley.
the Indonesian junior faculty learned Ameri can economics in Berkeley
classrooms, the professor from Berkeley set to turning the Faculty on
Jakarta into an American-style school of economics, statistics, and business
objected. At an annual lecture to the Faculty, team member Bruce Glassburner
recalls, Sukarno complained that "all those men can say to me is
'Schumpeter and Keynes.' When I was young I read Marx." Sukarno might
grumble and complain, but if he wanted any education at all he would have
to take what he got. "When Sukarno threatened to put an end to Western
economics," says John Howard, long-time director of Ford's international
Training and Research Program, "Ford threatened to cut off all programs,
and that changed Sukarno's direction."
Berkeley staff also joined Sumitro's protégés in the effort
to prevent the faculty's being brought more in line with Sukarno's "socialism"
and Indonesian national policy. "We got a lot of pressure through
1958-1959 for 'retooling' the curriculum," Glassburner recalls. "We
did some dummying up, you know-we put 'socialism' into as many course
titles as we could-but really tried to preserve the academic integrity
of the place." A very academic integrity, indeed.
was little chance, of course, that Sumitro's minuscule PSI would outdistance
Sukarno at the polls. But "Sumitro felt the PSI group could have
influence far out of proportion to their voting strength by putting men
in key positions in government," recalls the first project chairman,
a feisty Irish business prof named Len Doyle.
When Sumitro went into exile, his university carried on. His students visited him surreptitiously on their way to and from the U.S. Powerful Americans like Harry Goldberg, a lieutenant of labor boss and CIA-coordinator Jay Lovestone, kept in close contact and saw that Sumitro's message got through to his Indonesian friends. No dean was appointed to replace him; he was the "chairman in absentia."
of the unacademic intrigue caused hardly a ripple of disquiet among the
scrupulous professors. A notable exception was the essentially conservative
business professors, Doyle.
tried to get Doyle to hire "two or three Americans who were close
to Sumitro." One was Sumitro's friend from the MIT team, William
Hollinger. Doyle refused. "It was clear that Sumitro was going to
continue to run the Faculty from Singapore." But it was a game Doyle
didn't want to play. "I felt," Doyle explains, "that the
University should not be involved in what essentially was becoming a rebellion
against the government-whatever sympathy you might have with the rebel
cause and the rebel objectives."
home, Doyle's lonely defense of academic integrity against the political
pressure exerted through Ford was not appreciated. Sent there for two
years, Berkeley recalled him after one. "We had no choice but to
ship him home." In fact, Harris had him bounced. "In my judgment,"
Harris recalls, "there was a real problem between Doyle and the Faculty."
Anspach, a Berkeley team member now teaching at San Fransisco, got so
fed up with what he saw in Jakarta that he will no longer work in applied
economics. "I had the feeling that in the last analysis I was supposed
to be a part of this American policy of empire," he says, "bringing
in American science, and attitudes, and culture
winning over countries-doing
this with an awful lot of cocktails and high pay. I just got out of the
and Anspach were the exceptions. Most of the academic professionals found
the project-as Ford meant it to be-the beginning of a career. "This
was a tremendous break for me," explains Glassburner. "Those
three years over there gave me an opportunity to become a certain kind
of economist. I had a category-I became a development economist-and I
got to know Indonesia. This made a tremendous difference in my career."
phased out its people out of Jakarta in 1961-62. The running battle between
the Ford representative and the Berkeley chairman as to who would run
the project had some part in hastening its end. More important, the professors
were no longer necessary; in fact, they were probably an increasing political
stability. Sumitro's first string had returned with their degrees and
resumed control of the school.
Berkeley team had done its job, "kept the thing alive," Glassburner
recalls proudly. "We plugged a hole
and with the Ford Foundation's
money we trained them 40 or so economists." What did the University
get out of it? "Well, some overhead money, you know." And the
satisfaction of a job well done.