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The Jakarta Post
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Why do we need more political entrepreneurs?

  • M. Ari Margiono

    The Jakarta Post

Brisbane | Fri, March 20, 2015 | 06:40 am

We are witnessing the birth of a new breed of politicians in Indonesia.  Some of them have already started filling important positions.  

Many are new entrepreneurs '€” as opposed to second or third generation businesspeople (i.e. those who inherited a business empire from their family) '€” who turn to politics and seem to bring the dynamics of entrepreneurship into the political arena.  These politicians possess traits similar to that of start-up entrepreneurs.  They are political entrepreneurs.

Like in business, they attempt to combine their resources and find innovative ways to achieve their objectives. They know their '€œmarket'€ very well and they design '€œproducts and services'€ that cater to the needs of their '€œcustomers'€.

Entrepreneurs have always been associated with risk-taking, innovation and '€” often '€” the tendency to rock the established.   

When Schnieder and Teske ( 1992 ) outline a theory on political entrepreneurs, they refer to those individuals who change the direction and flow of politics.

Borrowing the logic of commercial entrepreneurs, they are those who bring equilibrium to politics '€” politicians who help get things back into order.

They may exert Schumpeterian'€™s logic of creative destruction where they alter the existing dynamics in order to change it for a better outcome; or they simply seize the existing opportunities to get the bureaucracy of the government to do things they should do.

Political entrepreneurs are innovative and risk takers. They are willing to take a risk to gain what they want to achieve '€” in this case the political '€œprofit'€ '€” a '€œsurplus'€ from making things better in society. They can be driven by altruism, but pure interests can also drive them.

Those who are driven by altruism may be motivated to doing good in society, but those who are driven by pure interest need to always take the side of their '€œcustomers'€ '€” in this case, the voters.

Either way, it is good for society. Their motivation may be less relevant '€” what they do is more important.    

Jakarta Governor Basuki '€œAhok'€ Tjahaja Purnama'€™s attempt to creatively destruct the established government-budgeting processes is an example of the act of political entrepreneurship.

He had to pick a fight with the '€œestablished forces'€ in the regional legislative council; he took the risk of being impeached and he used innovative ways (e-budgeting) to break the vicious circle of corruption.    

Many improvements in government services '€” such as one-stop public service '€” are also the results of political entrepreneurship. It involves innovation, creativity and risk-taking approach to rock the boat and to get things in order.

Political entrepreneurs may bring new hope to further drive Indonesia to a better future.        

What does this phenomenon tell us? First, we should not lose hope on our politicians. The fact that there are good political entrepreneurs in Indonesia indicates that there is a glimpse of light at the end of the tunnel. Political apathy is not a choice now.  

We need to support more political entrepreneurs to emerge. Fortunately, young generations side with political entrepreneurs. Widespread movements in the digital realm have provided broad moral support for political entrepreneurs.

Further, it is getting more important for voters to educate themselves. Voters are the '€œcustomers'€ of political entrepreneurs. They have to understand that they should not give away the '€œcurrency'€ '€” i.e. votes '€” to politicians. Every vote counts and voters have to be prudent in giving their votes to a particular politician.

Second, political entrepreneurs need good and healthy political parties to operate. Thus, political-party reform is now imperative. There are two major challenges facing political parties today. The internal democracy issue is one of them.

Political party decision making processes have been dominated by prominent families and groups of dominant cliques. As a conduit between the people and the House of Representatives, political parties need to embrace internal democracy.

Decision-making processes, election of leaders and other important aspects in party life should always be consultative to the constituents.

Sadly, thus far there is disconnection between voters and party decision making processes. Mechanisms to engage party members, voters and the public to take part in political party decision making should be taken seriously.  

One needs to always remember that a political party is neither a private organization nor asset.   

The other one is financial transparency. Many political parties in full-fledged democracies are funded by membership fees and donations. Indonesia should follow this path. Crowdfunding should become the main strategy of political parties financing.

Many property right theorists have argued (e.g. Demsetz, 1967) that this kind of funding mechanism does not allow anyone in the organization to claim control and authority; and therefore there is less potential capture from a group of individuals.

To raise public funds, politicians need to be creative and innovative. Recent research has indicated that crowdfunding appeals more to organizations and people that present a legitimate social cause.    

Third, the need to further uphold democracy and rule of law in Indonesia has never been more serious than today. Political entrepreneurs need a good system and an enabling environment to operate.

Just like with commercial entrepreneurship, there is a good, bad and ugly side of political entrepreneurship. It is the job of the government to ensure that rule of law is upheld so everyone can have a level playing field.

The writer, a faculty member of the Binus Business School, Jakarta is a recipient of the Australia Award Scholarship for research into business models of social enterprises. He is a PhD candidate at QUT Business School, the Queensland University of Technology, Australia.

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