Eroding Trust and Rising Inequality: Challenges to Democratic Resilience in Indonesia
Siti Khoirun Ni’mah, Executive Director of INFID
To function, a democracy needs to meet two conditions: it needs to enable a free public conversation on key issues, and it needs to maintain a minimum of social order and institutional trust (Harari, 2024)
Fragility of democracy in Indonesia
28 August 2025 marked a turning point that exposed the fragility of democracy in Indonesia. People took to the streets not because of political mobilization, but out of their own frustration and desire to be heard. Their anger was being fuelled by the government policies: the tax hike, the delay in passing the Asset Confiscation Bill, the increase in parliamentary benefits, difficulties in getting the job, huge amount of corruption, and increase the military roles in many civilian roles.
Discontent had already been simmering. Many citizens, struggling to find decent jobs and forced to work as online drivers without any protection, were outraged when lawmakers appeared insensitive to their suffering. Criticism flooded social media, with some voices even calling for the dissolution of parliament, which they saw as ineffective and disconnected from the people. The anger just not only happening in the capital city, but also people at district and village level. They felt frustration with the policy of government to reduce their budget make them loss their space to develop the program for the people.
Instead of listening, members of parliament responded arrogantly. They dismissed the criticism, claiming their benefits were “small compared to their work,” and even went so far as to insult critics by calling them “the most stupid people in the world.” Such reactions only deepened public anger. For many, the only way left to express their frustration was to return to the streets and protest.
At the same time, civil power is in challenging due to the growing of militarism. The government has passed the revised military law that justified the role of military in civilian domain. Hence, there is no option for civil society other than to consolidate into democracy agenda.
Deepening Inequality and Reducing the Trust to Government
Indonesia has been through long journey on democracy. Since the fall of Suharto in 1998, Indonesia has been celebrated as one of the world’s largest democracies. For more than twenty-five years, Indonesians have enjoyed the right to directly elect president, legislators, and local leaders. Five direct presidential elections have been held since 2004, producing three leaders: Susilo Bambang Yudhoyono, Joko Widodo, and Prabowo Subianto, who is set to take office in October 2024. Legislative elections are held in competitive way, with eighteen national parties and several Aceh-based local parties participating in the 2024 contest.
Despite this democracy journey, the benefits of economic progress in Indonesia are not being distributed fairly across society. Instead, wealth and resources remain heavily concentrated in the hands of a very small elite. According to a report by INFID and OXFAM (2017), inequality in Indonesia has widened at an alarming pace. Over the past two decades, the gap between the richest individuals and the majority of the population has grown more sharply. Strikingly, just four of the wealthiest Indonesians control more assets than the combined wealth of the poorest 100 million citizens. Such extreme inequality does not merely create disparities in living standards, it actively undermines efforts to reduce poverty, slows down long-term economic growth, and poses serious risks to social stability and cohesion.
The extreme inequality in Indonesia has increasingly become a catalyst for public discontent, raising concerns about both distributive justice and the resilience of democratic institutions. Data from the State Officials’ Wealth Report (LHKPN), submitted to the Corruption Eradication Commission (KPK), illustrates the magnitude of this imbalance where one of legislator member reportedly owns 28 motor vehicles with a combined value of approximately Rp 38.132 billion. To contextualize, a worker earning the 2025 provincial minimum wage (UMP) of Rp 3,113,360 per month would need to save their entire income, foregoing all expenditures for basic subsistence, for more than a thousand years to accumulate comparable assets.
Over the past decade, members of the Indonesian House of Representatives (DPR) have received salary increases of nearly 100 percent, whereas workers’ wages increased by only 48 percent in the same period. Such divergence reflects what Acemoglu and Robinson (2012) conceptualize as “extractive institutions,” where political elites leverage their positional power to capture economic gains disproportionately, reinforcing cycles of privilege. Similarly, Piketty (2014) has demonstrated how wealth accumulation, when left unchecked, tends to outpace wage growth, leading to entrenched inequality that threatens democratic legitimacy.
In this context, the Indonesian case exemplifies how elite privilege and asymmetric income growth are not isolated phenomena but part of global dynamics of inequality. The concentration of wealth among political elites undermines poverty alleviation, slows inclusive growth, and erodes social cohesion. More critically, it raises fundamental questions about distributive justice and institutional accountability, as persistent disparities risk delegitimizing democratic governance itself. Unless structural reforms, such as progressive taxation, stronger labour protections, and transparency in public office are enacted.
According to the report of the United Nations World Social Report 2025, which emphasizes that persistent inequality erodes citizens’ trust in their governments. The report highlights that when states fail to manage their economies in ways that ensure equal opportunities, create decent employment, and distribute prosperity more equitably, a widening “trust deficit” emerges between governments and their populations. Indonesia is not exempt from this trend. The growing perception that economic policies primarily serve elite interests, while leaving large segments of society behind, represents a significant challenge to democratic resilience. In this context, inequality is not only an economic issue but also a political one, as declining trust threatens the legitimacy, accountability, and stability of democratic governance in Indonesia.
The Growing Influence of the Indonesian Military
Indonesia is also facing the growing of militarism where it becomes significant challenge of democracy in Indonesia. Dr. Nicky Fahriza from CSIS said at INFID’s discussion that referring to Agus Widjojo (2015) there are four signs of a resurgence of militarism were identified are 1. the absence of political decisions or (civilian) policies in the deployment of the Indonesian National Armed Forces (TNI), budgeting, and defense force development, 2. the use of TNI capacity beyond the functions and authorities stipulated in law, 3. the TNI’s involvement in supporting practical political power, 4. the TNI’s lack of willingness and commitment to being placed under civilian authority.
Meanwhile, according to Prof. Ikrar Nusa Bhakti in the same discussion, several factors could encourage military involvement outside of defense affairs, including: 1. The military feels it has political rights in Indonesia because it participated in establishing the Republic; 2. The military also built itself and was not formed by the state (the military consisted of KNIL, PETA), and 3. The military felt it had more competence than civilians in terms of organizational skills, equipment, military and non-military education.
Evidence shows that the military is steadily expanding its role in civilian affairs. The ratification of the TNI Law – passed without sufficient public consultation – legitimized the military’s involvement in operations beyond warfare and allowed active soldiers to occupy positions in ministries and other civilian institutions. The TNI has also become directly involved in government programs such as the Free Nutritional Meal Program (MBG), where their roles include 1. Distributing food supplies to designated area, 2. Providing land for the construction of Nutrition Fulfilment Service Units (SPPG), and 3. Overseeing program implementation to ensure it meets government targets. Beyond this, the TNI also plays a role in food estate projects, including involving in forest management.
Having said that, consolidation of democracy to strengthen the civilian supremacy becomes an urgent agenda to avoid military take control over security and democracy agendas.
The Role of CSOs in Keeping Democracy for the People
Numerous evidences indicate a continued decline in Indonesia’s democratic trajectory, accompanied by the contraction of civic space. Civil society movements increasingly face threats, restrictions, and various obstacles that hinder their ability to operate effectively. These challenges are compounded by heightened surveillance measures and diminishing access to funding sources. Simultaneously, efforts by anti-democratic actors to delegitimize civil society have intensified, with accusations of being “foreign agents” or “lacking nationalism.” Such stigmatization, including that perpetuated by state institutions, continues to weaken and marginalize civil society.
At the same time, the circulation of information continues to expand rapidly, driven by the growth of digital platforms and the accelerating influence of algorithms. Both critical information and disinformation are easily accessible across different media channels, as individuals, groups, and corporations increasingly produce content from their own perspectives.
In this environment, the role of civil society becomes increasingly important. As Hans Antlöv emphasized during a discussion marking INFID’s 40th anniversary, when the trias politica (executive, legislative, and judiciary) fails to function effectively, civil society’s voice becomes essential. To strengthen this role, several prerequisites must be secured: safeguarding civic spaces where aspirations can be freely expressed, protecting these spaces from authoritarian pressures, ensuring the neutrality of the military, and encouraging the state to provide a supportive environment for civil society. At the same time, civil society must consolidate its efforts to detect and respond to signs of democratic decline, including by establishing effective mechanisms to protect human rights defenders.
Equally important is the need for civil society to build its capacity to create alternative narratives, particularly those that counter populist movements, while remaining rooted in the interests and voices of the people with persistently promoting inclusive and fair economic and social distribution. Ensuring democracy is not only in political space, but also social and economic democratic system must be in place. Including, strengthening legitimacy, credibility, and adaptability is essential to ensure that civil society remains relevant amid constantly changing political and social dynamics.
References:
This paper has been presented during the Asia Democracy Networks (AND) consultation in 16th September 2025 ahead of ADN assembly on November 2025
Yuval Noah Harari. (2024). Nexus A Brief History of Information Networks from the Stone Age to AI. Fern Pers.
INFID-OXFAM. (2017), https://indonesia.oxfam.org/latest/publications/laporan-ketimpangan-indonesia-menuju-indonesia-yang-lebih-setara
Komisi Pemberantasan Korupsi (KPK). (2025). Laporan Harta Kekayaan Penyelenggara Negara (LHKPN). Jakarta: KPK.
Acemoglu, D., & Robinson, J. A. (2012). Why nations fail: The origins of power, prosperity, and poverty. Crown Business.
Piketty, T. (2014). Capital in the twenty-first century. Harvard University Press.
United Nations. (2025), World Social Report 2025: A New Policy Consensus to Accelerate Social Progress. https://desapublications.un.org/publications/world-social-report-2025-new-policy-consensus-accelerate-social-progress
Nicky Fahrizal presentation in a discussion as part of 40 years of INFID (2025). His presentation refers to Agus Widjojo, TNI Transformation, 2015
Prof. Ikrar Nusa Bakti is a political analyst from Indonesia Research Institute (LIPI) from 1984 – 2017