Riffrag Business & Finance Report

Sri Mulyani Indrawati’s resignation from the post of Finance Minister in late May and then change the constellation of the economic team of the United Indonesia Cabinet (KiB), vol II.

President SBY leaving only two economists as a minister in the fields of economy, namely the Minister of Trade Mari Pangestu and Minister of PPN / Head of Bappenas Armida Alisjahbana. While the rest come from political parties, businessmen and bankers.

Then, to strengthen the economic team, President SBY also created the Committee on National Economy (KEN), the majority of its members are entrepreneurs. Presumably, with the election of officers among businessmen as public policy makers – especially in the economic field – will provide welfare for the community. As a result, if they successfully manage a business, will also succeed in managing the country’s economy.

Do not they have successfully managed to improve the life of him so it will also improve the life of their nation. Paul Krugman, Nobel Prize-winning economist Economics 2008, explained how dangerous if the economic policies of a country handed over to entrepreneurs.

In a treatise titled Country Not Companies (Margin of the Left: 2010), he explained the difference in character between an economist and an entrepreneur in the view the economy. According to him, thinking that forms a reliable businessman is not the habit of thinking an economist. Furthermore, he says, a president who made money USD1 billion is not the right person to be held opinions about the economy amounted to $ 6 trillion.

Why? Krugman affirmed, because the state was not a large company. Managing the country’s economy certainly is much more complicated than managing a business enterprise. In the economy of a country, there are thousands of different business lines and not infrequently even conflicting with each other.

They are united only because it is located in the same country boundaries. This is different from the economics firm, despite having business lines vary, but tend to be united by one main theme. This means that the business could not match the complexity of the national economic system. Fundamentally, Krugman says, the differences between business strategy with the economic analysis is the underlying systems.

Business activity is essentially an open system, while the national economy is a closed system. Entrepreneurs, says Krugman, is not accustomed to thinking about a closed system, while economists vice versa.

In open systems, competition is encouraged in order to achieve maximum profits. No matter gains by means losses for others. For example, tariffs product out of cocoa, palm oil or coal is low on one side of the business profitable plantations or coal entrepreneurs. However, the policy was actually turned off the downstream industries that difficulty in obtaining raw materials.

Now, in a closed system, exports had decreased to revive the industry. Another example is the success in one business line at a company, whether in financial, technology or marketing often helps the company to develop other lines. Will eventually employ more people in those fields.

However, in an economy that was able to sell many items usually will get negative feedback from the sectors of other economies. Or about interest rate policy. Employers often ask for lower interest rates reduced so that their businesses can become more fluent.

Entrepreneur properties, such as wanting to lower interest rates, then the house or apartment will sell quickly jualannya. For central banks, interest rates should be regulated because they are concerned to maintain that inflation does not become overheated economy which in turn raises new economic problems.

Krugman in this short treatise says, to carefully listen to advice employers on the issue of the national economy. He exemplifies the United States during the great depression in the 1930s, John Maynard Keynes called for policy makers and politicians in parliament to ignore the advice of the bankers and manufacturers.

But his advice ignored, and consequently even more severe economic crisis due to malevolent entrepreneurs who want to take advantage of a narrow slit. What about the situation in Indonesia? In addition to the public welfare are considered, the entrepreneur who became a public official is considered not possible for corruption.

This assumption could appear when selecting candidates for chairman of the Corruption Eradication Commission (KPK) recently that the new officers are people who are economically well-established that it is impossible to do this korupsi.Anggapan clearly wrong, because there is no correlation between being rich with a reluctance to corruption. In a public lecture held by the Association of Education and Democracy on May 18, Sri Mulyani explained his experience in government.

She said officials and businessmen often difficult to separate herself among the officials who make policy for the public to himself as an entrepreneur. They attempt to extract personal gain despite the government’s policy is wrapped with a very sophisticated as the interests of the community.

In another story, had at one time there is a conflict between two economic ministers on coal export tax. Ministers which one wants coal exports taxed as exports are rising. However, other ministers opposed it, and new coal exports can be taxed, if the price had doubled from the current price. Incidentally it is the ministers who opposed the “former” coal entrepreneurs.

This is where the importance of ethics for public officials, whether he’s coming from among economists, businessmen, political or professional. That once they occupy public office, then all the policies they make will affect the interests of society, and annihilate self-interest or group.

However, is this possible? When one of these days we presented a show of political drama, a businessman with a troubled about taxes and one company has caused severe environmental damage to important positions in the national political system, even a place to ask the blessing of political activists.

While the leadership of government and parliament as an eye patch over the damage already caused. What a horrible because in addition to economic power is also politically powerful.