The Parman Economy: Post-Authoritarian Shifts in the Off-Budget Economy of Indonesia’s Security Institutions

More than an alternative source of revenue, ABRI’s (Angkatan Bersenjata Republik Indonesia, Indonesian National Armed Forces) off-budget economy was an index of the army’s political clout. Those Indonesians who owned and controlled capital, principally the politically vulnerable ethnic Chinese, rushed to form joint enterprises with military generals during the New Order to “secure” their businesses. These enterprises formed the backbone of a vast off-budget economy, ostensibly justified as an alternative revenue source in the face of state budget deficiencies. In the post-Suharto era, there has been a shift in power, and the police have emerged as the principle providers of “security.” This article examines the police’s off-budget economy and looks at the questions raised by persistent police budgetary shortfalls to chart the emergent dynamics between Indonesian capital and security forces, identified here as the “parman economy.”