Trump gets another mess from Bubba Clinton to clean Indonesia

For all the talk about President Trump being the bull in the china shop of U.S. foreign policy, some recently declassified documents show then-president Bill Clinton as more worthy of that title.

With the documents being declassified now, and Indonesians now closely reading about them, guess who gets to clean up that mess.  Yep, President Trump.

Here is what Voice of America has on it:

The Clinton administration sought to preserve close ties to the Indonesian Armed Forces as President Suharto's rule came to an end in May 1998, even as the Army carried out significant human rights abuses, according to recently declassified documents posted today by the National Security Archive based at The George Washington University.  US officials were aware of the military's involvement in kidnappings and disappearances of student activists going on at the time but saw preservation of the Army's role as central to political stability in the country, the records show.

Those shenanigans were accompanied by rank economic warfare on Indonesia, under the guise of "helping" it.  Over in Indonesia, back in 1998, if you recall, there was a massive economic crisis, brought on by the meltdown of the Indonesian rupiah.  It was followed by riots that led to the resignation under pressure of President Suharto, the Indonesian strongman who got the country stabilized after the communists tried to take over in a bloody surge the 1960s.  Clinton triggered it with an economy-killing IMF "austerity" program and tried to pin the blame for the crisis on one economist, Johns Hopkins University professor Steve Hanke, for a Hong Kong-style currency board proposal to stabilize the economy.  The sharp spike between points 5 and 6 on the chart below (it should have its own red dot) shows the point at which Suharto announced that Hanke would be his adviser and the currency improving.  Instead of allowing that to happen, Clinton muscled Suharto into accepting an International Monetary Fund "austerity" program that he knew would crash his country's economy instead of the currency board, which would have fixed it, and the chart's red dots went downward.  Bubba loaded the strong-arm maneuver with oozing words of flattery.  All the red points on the chart are worth looking at in the legend here.

The declassified documents, which are being read very, very closely in Indonesia, show that actually, it was Bubba who was at the center of the crisis, not Hanke.  Steve Hanke has an important account describing how that happened.

The documents also show that Clinton was all buddy-buddy with Indonesia's shoot-'em-in-the-street military and thought they could take things over just fine if he got rid of Suharto.  This has got the lefties at Georgetown's National Security Archive riled up because they don't like the Indonesian military.  They are the ones who got the documents declassified – much sooner than is normally done.  With the military in his back pocket, Clinton moved full speed ahead to crash the Indonesian economy to get Suharto overthrown.  But the most important question is, why did he want to get rid of Suharto?

The archives have not all gotten out yet, and there are some significant things to watch for.  Clinton, remember, at the time was neck-deep in campaign finance scandals, including money that went to his campaigns via Indonesia.  Indonesian bankers such as James Riady and political fixers such as Johnny "subway" Chung were some of the prominent names that came up.  I was there during this unrest, and I recall that a top Indonesian banker at a prominent bank there told me Riady was instrumental in a lot of the machinations over whose bank got shut down in the crisis, so at a minimum, he had a lot of power, likely derived from Clinton and his campaign connections to Clinton. 

It's an absolute certainty that Suharto knew all about these machinations, and Clinton knew he knew.  This may be a big reason why Bubba meddled so significantly in that country.  The other factor was likely the role of former Indonesian ambassador Paul Wolfowitz, a Trump nemesis now, who was the architect of regime change in Iraq and who was loudly against Hanke's currency board.  I kind of suspect there will be information about where he got his practice for that coming out.  Factor three was the role China played in its multiple competitive devaluations that preceded the 1997-1998 Asian crisis.  We know that Trump is looking closely at that now.

The fallout that's certain is that the Clinton revelations leave a diplomatic mess to clean up.  Looks as if President Trump is going to be busy.

Image and notes credit: Arsonal via Wikimedia, CC BY-SA 3.0 and GNU Free Documentation License.

If you experience technical problems, please write to