CAPITALISM'S ACHILLES HEEL Dirty Money and How to

70 CAPITALISM’S ACHILLES HEEL
But not nearly as much as the yayasans, ostensibly collecting money for
social welfare but in reality larding the Suharto coffers. George Aditjondro, a
courageous chronicler of Suharto wealth, reported that 97 foundations were
established over a 30-year period. 33 A government investigation into just
seven of the foundations laid out some of the sources of “donations”:
• Two-and-a-half percent of the profits of the central bank and all
state-owned banks.
• Two percent of the incomes of individuals and state and private companies
making more than $40,000 a year.
• A percentage off the salaries of civil servants and other government
employees.
• A percentage off electric bills, movie tickets, and other consumer expenditures.
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Some of the money was dispensed for the welfare purposes stated. Out of
the seven foundations probed, well over a trillion rupiah, adding up to billions
of dollars, flowed to enterprises controlled by Suharto family members
and their partners, as shown in Table 3.2.
To put it simply, Suharto ruled the country, set up the foundations, required
the donations, controlled the funds, approved the distributions, and
hugely enriched himself, his family, and friends. This is one of the neatest
cycles of corruption seen in the twentieth century, with nearly every foreign
investor required to participate. And, incidentally, it is the same technique
used by terrorists across two decades: collecting money for supposedly charitable
work, spending a little on social welfare, and using the rest for nefarious
purposes.
When you are in full control of a nation, one of the great perks of office
is that you and your family can renege on personal debts or get the state to
pay them for you. Suharto’s eldest daughter, Tutut, understood the drill well.
She set up a private television station, TPI, in the early 1990s, using equipment
“borrowed” from the state television service and funds “borrowed”
from her own Bank Yama. Running up heavy debts, she twisted the arm of
Indosat, the state long-distance telephone company, to buy $45 million of
convertible bonds, rescuing both her TV station and her bank. 35
Tommy Suharto, youngest son of the president, and crony Bob Has-