In Indonesia, the past is ‘Ivy League Mafia’ by President Pabowo

The recent establishment of Danantara, the new sovereign power fund of Indonesia, has yielded a considerable public interest, but also a certain degree of concern. Such reactions are understandable in a country with the complex political and economic landscape of Indonesia, where large -scale institutional innovations often cause skepticism and uncertainty. However, it is important to acknowledge that sustainable national growth requires daring and strategic shifts. Although Danantara can represent a deviation from traditional economic management, this is not without precedent. A historical perspective reveals a remarkable parallel in the past of Indonesia that can offer valuable insights into the present.

Indonesia has traditionally used to elite technocrats and centralized state power in times of required economic transformation. An important case in its history after independence illustrates this strategy: the use of President Suharto of the so -called ‘Berkeley Mafia“During the new order regime you can compare with the establishment of President Prabowo Subianto by Danantara. Although the historical contexts differ-the first to come from the cold war policy, recession and hyperinflation, and the last in the midst of the worldwide economic redesign and the rise of strategic sovereobation, laughingbethivebepie Global, global, global, global, global, global, global, global, global, globally able to follow a normal political transformation, globally capable, globally, globally capable, globally capable, globally capable, globally, globally, globally, globally, globally, globally, globally, globally, globally, globally, globally, global, global, globally, globally latter, globally, globally, global, global, globally, global, global, globally, global, global, global, globally.

The leadership of Danantara has attracted special attention because of the academic pedigree: more than 40 percent are graduates from Ivy League institutions, while many others achieve degrees from Western universities. This concentration of elite education has led some observers to call the group the ‘Ivy League Mafia’, who owed the circles of foreign trained experts who surrounded Suharto during his more than 30 years in power.

The Berkeley Mafia: Technocratic stabilization in the Suharto era

The events at the end of 1965 led to political revolution and an economic crisis characterized by rising inflation, exhausted reserves and collapsed investor confidence. General Suharto emerged as a key figure, consolidating power and turn to Western trained economists, many trained at the University of California, Berkeley.

The Berkeley Mafia, influenced by Western models that promote tax discipline and global integration, implemented macroeconomic reforms that stabilized the currency, limited inflation and restructured the economy. Supported by the United States, the World Bank and the International Monetary Fund, they laid the foundation for the five -year development plans of Indonesia, which focused on economic and industrial development.

Although effective in the recovery of stability and growth in the seventies and eighties, this policy also made friendly capitalism possible. The Suharto regime concentrated the economic power in a small elite, which makes corruption facilitated. The technocrats had freedom in shaping policy, but operated in the authoritarian framework of Suharto-a model that was currently seen in other fast-growing Asian economies.

Danantara: Nation building through sovereign wealth in the Prabowo era

Fast forward to 2025, and Indonesia again strives for an ambitious economic transformation under President Pabowo. Danantara was established to unlock the value of the state-owned companies of Indonesia (SOOs), to attract investments and to increase GDP growth from 5 percent to 8 percent by 2029.

Founded through legislative amendment and operational under direct presidential authority, Danantara started with $ 20 billion in capital and manages the interests of the state in large soes such as Ptamina, the State file PLN and Bank Mandiri – who may supervise $ 900 billion in assets.

Of the 22 members of the Danantara management team, nine Ivy League alumni are. The majority of the remaining team has degrees from other Western universities, which strengthens their worldwide experience. This Ivy League mafia symbolizes the constant dependence on Indonesia of foreign technocrats.

Just like the Berkeley Mafia, the Danantara team reflects a technocratic solution for developmental challenges. In the 1960s, Western economists offered credibility to attract foreign partners. In the same way today, Danantara’s elite team is planning to give confidence to global investors. In contrast to the reactive approach of the 1960s, however, Danantara is a proactive strategy to Gulf sovereign power funds, aimed at investing in energy, AI, food security and critical minerals.

Parallels in strategy and structure

Despite various historical contexts, both the Berkeley Mafia and Ivy League Mafia share common elements

Both rely on elite technocratic leadership, in the form of internationally trained experts with strong global networks.

Both work under centralized presidential supervision. Suharto kept control of Berkeley’s Mafia while allowing autonomy – just like Pabowo with the Ivy League Mafia by Danantara.

Both initiatives were aimed at modernizing the Indonesian economy, although the Berkeley Mafia prioritized stabilization, while Danantara emphasizes technological self -supply and competitiveness.

Both use state resources to achieve their goals. Suharto initially used SOOs to stimulate industrialization before shifting to the private sector and foreign investments. Pabowo is planning to use Danantara to consolidate and optimize SOO’s strategically, while they are still attracting private and foreign investments.

Finally, both credibility abroad, in the hope that international credibility would stimulate investments. De Berkeley Mafia turned to Western governments and institutions; Danantara works together with Gulf funds and worldwide capital.

Differences in context and implementation

However, important differences must also be noted.

De Berkeley Mafia operated under authoritarianism; Danantara functions in a democracy, albeit with increasing concern about bridging the executive power.

The Cold War was the 1960s; Today’s world has multipolar politics, low -carbon and economic nationalism.

The agenda of the Berkeley Mafia was largely reactive – to save a collapsing economy. Danantara is future -oriented and strategic, designed to re -design the position of Indonesia in the global supply chains.

De Berkeley Mafia operated in an era with limited public control. Danantara, on the other hand, has activated immediate market reactions, which reflects the concern of investors about governance and fiscal impact.

Structural risks and management challenges

Although both the Berkeley Mafia and Ivy League Mafia are bold, elite -led strategies for economic transformation, they are not without serious structural risks and management challenges that can undermine their intended results.

The Berkeley Mafia was often criticized because he was elitist and detached from the reality of everyday Indonesians. The Ivy League -Mafia stands for similar concerns about coverage and soe dividend Redirection.

Under Suharto, the Berkeley Mafia stood for little supervision, which led to concentrated power. Danantara is confronted with similar risks, because audit organizations do not have a complete authority. Ensuring transparency requires independent audits, stronger laws, public reporting and a supervisory board.

Just like the Berkeley technocrats, Danantara’s leaders should not be punished for unforeseen setbacks. But if the performance is repeatedly left behind, they must be replaced – not criminalized – to maintain credibility and discipline.

The development gains of Suharto were accompanied by deep -rooted patronage networks. Without strict guarantees, Danantara risks comparable elite catches, especially in view of the centralization of state capital and influence.

Both eras reveal the risks of democratic or bureaucratic checks in favor of executive dominance. Centralized decision -making, even when efficient, can lead to corruption or mismanagement without an institutional balance.

Danantara’s strategic sectors and priorities

Danantara’s investments are positioned as aids for building nation, not just financial movements. They are aimed at sectors that increase GDP and self-supply in the midst of global supply chain instability and the nationalism of Ascendant Resource.

When using the natural resources of Indonesia, the aim is to go up the value chain by concentrating on the domestic refining of mining and EV-related materials such as Nickel, following Suharto’s strategy of the 1970s with oil and forestry.

With the emphasis on AI and Tech Infrastructure, Danantara is looking for digital self-supply, in contrast to the Berkeley Mafia that focused on fundamental macro-economic policy.

Danantara invests in upstream gas, pipeline infrastructure, oil refining and renewable energy sources to position Indonesia as a regional energy hub. The Berkeley Mafia has used Indonesia oil and gas sources to develop the economy.

Danantara also contains a focus on agricultural infrastructure and logistics, with the aim of reducing the dependence on food import and building the economic resilience in the countryside, which was also one of the objectives of the Mafia van Berkeley.

All these sectors represent long -term strategic bets that are not only aimed at generating returns, but also on repositioning Indonesia within global supply chains.

Echos from the past, ambitions for the future

Danantara represents a crucial moment in the economic trajectory of Indonesia, which the dependence on Suharto in the Berkeley Mafia following Prabowo following Prabowo’s appointment of foreign technocrats. This leadership model combines historical continuity with modern investment strategies, with the aim of positioning Indonesia as a regional leader in sectors such as energy, AI, food security and critical minerals.

While De Berkeley Mafia managed to stabilize and grow the economy, Danantara’s centralized approach brings the risk of elite, political interference and weak supervision. Public concern about the limited audit authority underlines the need for institutionalized transparency, including independent audits and clear reporting. The success of the fund depends on the ability of his leadership to balance global best practices with domestic accountability and inclusive national benefit.