Indonesia's political and socio-economic developments in 2008 were marked by two contradictory trends. On the one hand, the process of democratic consolidation continued, with Indonesia further strengthening its political institutions, making progress in its anti-corruption drive and generally maintaining healthy economic growth. Indeed, with very low levels of political and communal violence, Indonesia in 2008 appeared like a bulwark of stability in the Southeast Asian region, as Thailand was crippled by incessant mass demonstrations and the Philippines saw the Mindanao insurgency escalating once again. However, Indonesia's democratic consolidation was also challenged by a very divergent phenomenon: that is, the increasing proliferation of some form of nostalgia for the effectiveness of Soeharto's New Order, which had ruled the country with an iron fist between 1966 and 1998. Significantly, the year 2008 not only witnessed Soeharto's death after a long struggle with illness and the post-authoritarian judiciary, but also the tenth anniversary of the democratic regime change. Using both occasions to reflect on Soeharto's achievements, many Indonesians concluded that his regime had been superior to the existing polity in several important aspects, particularly health services, prices of basic goods and security. This sentiment was also reflected in the names that emerged as contenders for the 2009 presidential elections: several of Soeharto's former generals threw their hat into the ring, trying to profit from the growing sympathy for New Order policies.

This chapter aims to take account of both developments: the remarkable stabilization of Indonesian democracy and the latent support in society for Soeharto's authoritative and tough leadership. Accordingly, it will discuss events, trends and patterns that dominated Indonesia in 2008 by looking at five different areas: first, the progress that Indonesia has made in advancing key democratic institutions and procedures, including elections and the fight against corruption. Second, the public reaction to Soeharto's death in January 2008, which highlighted the attitudes of Indonesians toward the New Order and the current polity.