Sukarno
Guided Democracy period (1959–1966)

The impressive military victories over the PRRI-Permesta rebels and the popular nationalisation of Dutch companies left Sukarno in a firm position. On 5 July 1959, Sukarno reinstated the 1945 constitution by presidential decree. It established a presidential system which he believed would make it easier to implement the principles of guided democracy. He called the system Manifesto Politik or Manipol - but it was actually government by decree. Sukarno envisioned an Indonesian-style socialist society, adherent to the principle of USDEK:

After established guided democracy, Sukarno along with Maladi meet Devi Dja, an Indonesian-born dancer who changed her citizenship to United States, in mid 1959, and convinced her to return as an Indonesian citizen, which Dja refused and credited him as an extreme nationalist person. In March 1960, Sukarno disbanded parliament and replaced it with a new parliament where half the members were appointed by the president (Dewan Perwakilan Rakjat - Gotong Rojong / DPR-GR). In September 1960, he established a Provisional People's Consultative Assembly (Madjelis Permusjawaratan Rakjat Sementara /MPRS) as the highest legislative authority according to the 1945 constitution. MPRS members consisted of members of DPR-GR and members of "functional groups" appointed by the president.

With the backing of the military, Sukarno disbanded the Islamic party Masyumi and Sutan Sjahrir's party PSI, accusing them of involvement with PRRI-Permesta affair. The military arrested and imprisoned many of Sukarno's political opponents, from socialist Sjahrir to Islamic politicians Mohammad Natsir and Hamka. Using martial law powers, the government closed down newspapers who were critical of Sukarno's policies.

During this period, there were several assassination attempts on Sukarno's life. On 9 March 1960, Daniel Maukar, an Indonesian airforce lieutenant who sympathised with the Permesta rebellion, strafed the Merdeka Palace and Bogor Palace with his MiG-17 fighter jet, attempting to kill the president; he was not injured. In May 1962, Darul Islam agents shot at the president during Eid al-Adha prayers on the grounds of the palace. Sukarno again escaped injury.

On the security front, the military started a series of effective campaigns which ended the long-festering Darul Islam rebellion in West Java (1962), Aceh (1962), and South Sulawesi (1965). Kartosuwirjo, the leader of Darul Islam, was captured and executed in September 1962.

To counterbalance the power of the military, Sukarno started to rely on the support of the PKI. In 1960, he declared his government to be based on Nasakom, a union of the three ideological strands present in Indonesian society: nasionalisme (nationalism), agama (religions), and komunisme (communism). Accordingly, Sukarno started admitting more communists into his government, while developing a strong relationship with the PKI chairman Dipa Nusantara Aidit.

In order to increase Indonesia's prestige, Sukarno supported and won the bid for the 1962 Asian Games held in Jakarta. Many sporting facilities such as the Senayan sports complex (including the 100,000-seat Bung Karno Stadium) were built to accommodate the games. There was political tension when the Indonesians refused the entry of delegations from Israel and Taiwan. After the International Olympic Committee imposed sanctions on Indonesia due to this exclusion policy, Sukarno retaliated by organizing a "non-imperialist" competitor event to the Olympic Games, called the Games of New Emerging Forces (GANEFO). GANEFO was successfully held in Jakarta in November 1963 and was attended by 2,700 athletes from 51 countries.

As part of his prestige-building program, Sukarno ordered the construction of large monumental buildings such as National Monument (Monumen Nasional), Istiqlal Mosque, Jakarta, CONEFO Building (now the Parliament Building), Hotel Indonesia, and the Sarinah shopping centre to transform Jakarta from a former colonial backwater to a modern city. The modern Jakarta boulevards of Jalan Thamrin, Jalan Sudirman, and Jalan Gatot Subroto were planned and constructed under Sukarno.
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