Fire Over Indonesia

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    The military will be unable to help Megawati where it matters most: in the economy. The new President has shown little grasp of finance. An ex-minister recalls spending a night crunching a lengthy technical report to two pages for her. "She couldn't even get through the first few paragraphs," he lamented. "Then she asked if there were any new projects where she could cut the ribbon." Foreign investors are concerned that Megawati may appoint her husband's business cronies rather than solid professionals to the government's key economic jobs. Indonesia owes $140 billion in foreign debt, inflation is nearing double digits, and the rupiah is one of the weakest currencies in the region. Corruption remains rife. Many foreign companies have left, angered by a constant hassle for bribes. A Western insurance executive was jailed last December under false charges and soon found out why: a senior police officer came to his cell demanding he hand over his company's shares in a local firm.

    Meanwhile, in the far-flung islands of the archipelago, Indonesians are starting to thumb their noses at Jakarta. Squatters invade mines and plantations, nobody pays taxes, smuggling is rampant, and murders go unpunished. Since February, some Dayak tribesmen in central Kalimantan have kept the heads they cut off Madurese migrants as trophies of magic power. Indonesia has more than 1.2 million refugees from ethnic violence. Says sociologist Paulus Wirutomo: "There's a hate being kept alive in our culture. We have to get rid of this." Wahid tried but failed. And Megawati?

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