Implementation of Pancasila
Economic System Based on Sustainable Development Based on Kinship
Amstrong
Harefa1*,
Jesslyn Elisandra Harefa2
Universitas
Nias, Gunungsitoli, Indonesia1*
Universitas
Sumatera Utara, Medan, Indonesia2
Email : amstrongharefa12@gmail.com1*,
jesslynharefa19@gmail.com2
Abstract
The Pancasila economic system aims to renew
the national economy in a structured, systematic, and massive manner by ensuring constitutional
freedom in sustainable development based on family values
to improve the quality of
human life. The research formulates an effective
strategy to implement the Pancasila Economic System within sustainable development, identifying challenges and obstacles and
evaluating the impact of its
family-based approach. This study employs literature research, collecting data through reviews of books,
articles, journals, and relevant internet sources. The data collection tool is document
research, and the data is analyzed
qualitatively. Results indicate that an
effective strategy for implementing the Pancasila economic system involves stakeholder and government involvement in policy-making, using a conceptual foundation to guide development.
The system faces challenges such as global competition, foreign cultural influences, and technological transformation. To address these, collaboration among the government,
private sector, and community is
essential. For economic progress, the Pancasila economic democracy should be implemented
based on kinship principles, emphasizing ethical, democratic values and a social sense
of kinship among economic actors.
Keywords: Pancasila
Economy, Sustainable
Development, Familiation
Introduction
The Pancasila economy is a system
that uses the precepts of
Pancasila as its philosophy
The idea of economic
strategy embraced in the Pancasila economic system is like
a pendulum of a clock that always rotates
from left to right until it reaches the
point of equilibrium. From the left means
that there is state or
government intervention, from the right
it means that it is
free to adjust
to the development
of market flows
The principles of the
Pancasila Economic System that
can be carried
out are as follows
Philosophically, the goal
of Indonesia's national development is enshrined in the Preamble to the 1945 Constitution stated about the
protection of all Indonesian people including the earth,
water and natural resources, improving people's welfare, advancing the world
of education to educate every
citizen, and also the state
always takes part in the world
order through free and active Indonesian politics,
The ideology of Pancasila as implied in the 1945 Constitution reveals that the national
economy always contains the principles
of justice and equity, welfare
and common prosperity based on family. The Pancasila economic ideology basically has ideas and ideas as well
as principles for managing and building
the national economy in a total and sustainable manner. Pancasila and the goal
of sustainable development as a form of social contract
have been fully implemented (beyond expectations) both in composition and instrumental role,
Considering that the Pancasila economic system prioritizes the principle of kinship,
the Pancasila economic
system is always associated with people's welfare
efforts, so this principle is also the basis for sustainable development. By ensuring equal economic access for all citizens
through the Pancasila economic system, the unity of the
nation can be strengthened through the process of mutual cooperation.
The role of Pancasila
in the development of the national economy
is to combine the strength of small and medium economic units and resources as the basis for production and distribution, based on the principle of synergy
and mutual progress. In the Pancasila economic system,
all elements of society are connected
through an integrated and comprehensive
national economic policy so that all
Indonesian people feel a sense of social justice,
Thinking about the
Pancasila economy continues to develop in all aspects. It will not stop even if it is
considered too slow by some amateurs or too slow by some experts. When the Pancasila economy is carefully implemented
in a socially equitable manner, it is
certain that the people when
they are in the realm of market
management will certainly not be easily affected by capital-intensive sectors in unhealthy competition. The impact of inconsistency on the market
with social justice, the fact
is that many
countries with smaller economies collapse and cannot
survive in the global space and experience
failures in the management of the
market system. Therefore, it is best to
avoid the free market in Indonesia, instead implementing
a well-managed
market economic system. This means that
the government must be able to control the market and carry out various
market interventions, especially when the interests
of the state
and society are compromised.,
However, the reality in practice is that the
government prioritizes the conglomerates more, namely responding
to their requests or demands
under the pretext that the
conglomerates pay their taxes more
than the lower classes, and they are even
given the space and opportunity
to obtain certain positions in the government. The advice of the
implementation of the Pancasila economy should be oriented
towards a sense of family, not just leaning towards profit and economic satisfaction (utility)
According to Hatta, the first
Vice President and Father of
Indonesian Cooperatives, the national
economy is based on
Pancasila with a sense
of mutual cooperation, kinship and cooperation as mandated in
Article 33 of the 1945 Constitution. To realize
a national economy based on Pancasila, it should be prioritized
from five commandments that are characteristic, including: a)
In decision-making in the economic field, it reflects the
guidance of religious teachings and ethical values;
b) Economic development based on the
values of the people's economy;
c) Each institution that manages the
economy is agreed upon through
consensus deliberation; d)
All important production is always under
the control of the state
to achieve the welfare of
the people; e) All natural resources of Indonesia remain under the
control of the state; f) The State recognizes individual property rights but still
pays attention to the public
interest; g) Supporting the strengthening of the people's
economy in the regions, but always
prioritizing greater interests; h) poor and abandoned children in the care of the state; (Library of the
Republic of Indonesia, 2024).
Research Methods
Research methods are needed to advance the field of science and technology,
The research method used is a literature
research method using a qualitative research approach. In solving problems in this research, certain techniques are applied that are managed systematically, so that answers
to each question
that have been set are obtained. As a follow-up to the
solution to the problems faced,
data was collected from several scientific
papers through the results of
a critical and in-depth study of several research materials. However, the author must
first ascertain where the source
of the information
was obtained. The sources of information
used in this study are in the form of
textbooks, articles, academic journals, the internet and several sources that are still considered relevant
In this study, the author uses a type
of research, namely normative juridical, meaning that a set of legal regulations and legal provisions (law
in books) is presented or in the form of
rules that have been conceptualized
based on the behavior of
people who are considered worthy,
The data collection technique in this literature research is by
carrying out review research on books, notes, reports and several
literature, of course, which are related to the
problems faced to be solved.
This method is necessary for
the purpose of obtaining evidence
or written opinions of experts
through several literatures, of course, related to the problem being researched. This literature review method is carried out by
sorting articles in the form of other legal provisions , books, journals, other academic papers, and also from internet sites that
are considered still relevant as the problem being explored from this
research. The data collection
tool in this research realm is using document
research,
The data analysis used in this writing is
qualitative data analysis.
In turn, qualitative data analysis sniffs out data manipulation, organization, categorization into units that can be processed,
synthesis, search and capture polarization,
related identification needed to be
considered, then informed to others
about what they should do
so that they
are capable of presenting information
Results and Discussion
Effective Strategies
to Implement the Pancasila Economic System in the Framework of
Sustainable Development
Basically, the concept
of sustainable development is determined so that
the needs of the community
are met without having to sacrifice
the interests of future generations.
The sustainable development
approach is intended to achieve
harmony and balance between social welfare, environmental sustainability and economic growth.
This sustainable development can improve the welfare of life. Welfare is one
of the concepts
of sustainable development. In addition to these concepts, other concepts are also being promoted, such as development that aims to increase renewable
natural resources and preserve or maintain
the quality of life of the community now and
in the future. The next concept is
to make the best use of
natural resources
so as not to produce waste and not cause negative impacts on the environment. The latter concept will ensure that natural resources are
well managed and future-proof.
The main principles of sustainable development include economic sustainability, namely sustainable economic development, namely creating jobs, increasing income and improving the quality of
life without damaging the natural resources that are the basis of economic growth; sustainability preserves the environment, namely the protection and preservation of the natural environment, especially policies in the use of
natural resources and the reduction of
negative effects on the environment,
including in terms of reducing greenhouse
gas emissions, maintaining biological variability and treating waste
effectively and efficiently. Good economic continuity will build an
inclusive and equitable society when social disparities
are reduced, citizens'
human rights are upheld, and equal opportunities
and access to every available
resource is provided.
Sustainable development aims to integrate these three dimensions into policy planning and implementation so that the results
of development can be enjoyed
by the current
generation and also the next
generation in the future. Internationally, this concept has been promoted through various initiatives such as the Sustainable
Development Goals (SDGs) implemented by the United Nations (UN). The SDGs include 17 interrelated goals to achieve global prosperity by 2030.
That the
vision of Golden Indonesia
has three keywords, namely "sovereignty, progress and sustainability,"
which is the dream of
the Indonesian nation.
Of course, the success of
this development is facilitated by the role of
the community market. Development to achieve balance and equitable distribution
of results at all levels
of society is one of
the steps to improve the
quality of all life goals
and improve people's living standards, self-esteem, and sense of belonging
Good governance means implementing sound and proportional
development management as
the essence of proper market
democracy, striving to overcome the
integrity of investment allocation, avoiding corruption at the political
level and administrative services, comprehensive budget discipline, and ensuring budget discipline, and policy setting
legal and political framework for the
growth and development of business activities,
Actually, the basis of the Pancasila economic system is a market economy
that starts from the achievement
of a market economy with social
justice, namely by developing and
advancing, among others, people's plantations, people's agriculture, people's fisheries and people's
livestock. The agricultural
sector with Pancasila nuances will certainly
support efforts to alleviate poverty
for the purpose
of achieving people's welfare. It can be
said that the Pancasila economy has rules of the
game in all economic activities between economic actors based on
the ethics and moral values of Pancasila. The goodness of Pancasila should be the basis of
humanistic rights that are surrounded by enthusiasm for
nationalism and democracy so that
a fair market economy can be
realized for every Indonesian citizen, as
Karno said that the essence of Pancasila (eka
sila) is mutual cooperation or
kinship,
In order to achieve the
distribution of land resources sector, production sector, as well as the provision of
roles and opportunities to women, the focus
of development should be placed
on equality with social justice,
but equality cannot be achieved
directly. Justice is a concept, relative, and cannot be measured directly, although the ethical aspects of sustainable
development are
inclusive and equality is increasing
in many countries, the income gap between the rich
and the poor
is widening.Another ethical aspect that must be considered in sustainable development is the future prospects of future generations, which should not be damaged by the activities of the current generation, that is, the
development of the current generation must also pay attention
to meeting the needs of
future generations.
Based on the description stated above, it
can be said
that sustainability is not a complex concept because there are many things that
need to be
considered and interrelated in its actions. Considering
that the understanding of sustainable development is based on the Pancasila economic system , its improvement is seen as important to
achieve development goals, especially for policymakers at both the macro
and micro levels. Understanding the concept of sustainable
development requires a conceptual or theoretical foundation in its application that can be
used as a reference for the direction of development.
Therefore, all stakeholders can truly understand and apply various concepts
and considerations regarding sustainability aspects, identify them and formulate various strategies that will be a reference to achieve development goals. In order to ensure the
continuity of development, government involvement is needed in setting short, medium and long-term development directions and policies.
Challenges and Obstacles in the Implementation of the Pancasila Economic System
The Pancasila economy is an
economy that contains the essence
of the precepts
of Pancasila, so it is appropriate
to focus on legal certainty for every citizen
to obtain fair treatment in the progress of
the national economy. Although in the current era of globalization, the Indonesian state is facing big
problems when implementing the family-based justice Pancasila economic system. One of the reasons
is that there
are still many community members who have beliefs
that are not in tune with the mandate
of the spirit of Pancasila. Of course, this is
an obstacle because of the
occurrence of cross-opinions and long debates in the community, especially the number of
citizens who do not yet have
the awareness to live and
practice the values of Pancasila.
The challenges and obstacles in the implementation of the Pancasila economic system are as follows:
First, the capitalist
economy controls the progress of
globalization. Basically, the capitalist economy maximizes efficiency and unlimited competition to reap profits,
while the Pancasila economy actually maximizes the balance
between the principle of equality
and the rate
of economic growth. This fundamental intersection is the challenge to
the implementation of the Pancasila economic system. Second, the presence
of the culture
of other countries in the era of globalization that entered Indonesia has become a complicated problem or a real challenge faced by the
Pancasila economy. As a result,
the application of mutual cooperation
and social justice is difficult
because many citizens are affected by cross-cultural relations between countries. Therefore, it is demanded
that the government should take steps to
implement the essential values of Pancasila, so that the community
is always guided by the
goodness of Pancasila; Third, the advancement
of digital transformation technology will be a tough challenge
in realizing the Pancasila economy, which will certainly have an impact
on business behavior and the
way citizens communicate. Therefore, it is hoped
that the government must be selective in socializing the latest technology products, in order to preserve the essential
values contained in
Pancasila, especially in today's
digital era
The Pancasila economic system continues to provide space
to answer the challenges and developments of the global and digital economy. The
Pancasila economy is the growth of the national
economy. The national economy is a basic
economy which is one of
the branches of Indonesian populism
is a populist-based economy, namely an economy
that prioritizes the interests of
the people, in the sense of
an economy that is centered
on the people, namely by continuing to
provide a balanced and fair place for capital owners.
The national economy must always be in harmony or connected to the development
of the global economy and the
digital economy. The Pancasila economy
remains a guideline for just, creative, and cooperative economic growth in
order to realize the principle of
justice for every Indonesian citizen
In
order to realize the economic growth
of Pancasila in Indonesia, there
are various problems of economic progress,
especially at the level of productivity
that must be addressed, especially
in the sources of labor growth,
capital and factory productivity, including providing
convenience for the middle and
lower entrepreneurs. Next, the optimal use of demographic
capital, especially by creating jobs
for the unemployed
and advancing the growth rate
of short- and medium-term economic development. When viewed in terms of technology adoption,
generally national products for export
commodities are still relatively low technology products so that these
products lack added value
The world is currently
experiencing a mass downturn due to
the impact of the coronavirus
pandemic some time ago. As a result of this
coronavirus, almost all countries are facing economic, social, health and political crises,
in addition to the globalization crisis due to
the rampant capitalism and liberalism system. But of course,
this actually provides space and opportunities for the Indonesian state to manage
and utilize natural resources to maintain its
sovereignty in the economic field and not only rely on globalization. Now is the time
for Indonesia to adhere to Pancasila which started from Soekarno-Hatta and was inherited by
the Founding Fathers, then by Emir Salim, Mubyarto, Dawam Rahardjo, and until now by economists such
as Didin S. Damanhuri and Erani
Justika It is time to
return to the economic system.
As a unique and authentic economic system, the Pancasila economy is described in the 1945 Constitution Article 33 as the implementation of the fifth precept
of Pancasila
The Indonesian Chamber of Commerce
and Industry (KADIN) said that when a country's
economy is managed in a way of high nationalism,
there will be collusion between
businessmen and rulers through acts of communal
monopoly and of course this
behavior is not in accordance with ethics in the life
of the nation
and state. As a result, it will
be difficult to achieve the
welfare of the people because
the behavior of stakeholders has hurt the social
values of justice. That in order to achieve fair
and equitable economic politics at all levels
of society as demanded by reform,
the government through the People's
Consultative Assembly of the Republic of Indonesia has issued two Decrees, namely:
First, Decree Number
XVI/MPR/1998 concerning Political
Economy in the Context of Economic
Democracy. Mandate provisions regarding strategies and policy directions for the implementation
of development in the field of
a strong national economy, always provide support and opportunities, as well as the development
of people's economic progress including SMEs, cooperatives to be designated as the main pillar of national economic
development; second, Decree of the People's
Consultative Assembly of the Republic of Indonesia Number IX MPR/2001 concerning Agrarian Reform and Natural Resources Management.
Emphasizing that
national economic development based on the utilization
of agrarian resources/natural resources including the earth,
water, space and natural resources contained in them, must be used
as optimally as possible in
order to save the present and
future generations so that the
ideal of realizing a just and prosperous
society can be achieved. However,
the reality that the implementation
of development in the economic sector
is still not carried out fairly
and equitably, which always sacrifices
equality for the sake of achieving
economic growth. Every period
of government is often prone to pragmatic tendencies
so that national goals and the foundation of the constitution are neglected.
As a result, a complex economic pattern arises and the
exploitation of natural resources is very detrimental,
followed by social disparities in the community and
market prices that continue to
increase sharply, such as the occurrence
of a very unequal land tenure
gap, where on one side there
is one person or one group
who controls hundreds of thousands
of hectares or even millions
of hectares of land. but on the other
hand, millions of farmers only
have an
average of 0.3 hectares and even
more do not have land
Ironically, stakeholders
both in the regions, especially at the central
level, tend to prioritize large entrepreneurs with a variety of facilities
and opportunities, on the contrary,
the middle and lower economic
groups do not receive attention or do not get
the facilities they should have
so that they
are far behind for the progress
of their business. The realization of social welfare
will certainly be more difficult
to achieve, when the system
of contradictions in the world of
politics and the national economy
is still maintained and maintained. It is certain that
economic disparities and injustices will continue so
that the ideals of the
nation's struggle for independence become in vain. The biggest challenge for the Pancasila economy is not only globalization, but also the
spirituality and quality of officials.
No matter how good the
concept of the economic order is, it will
not achieve maximum results if it
is applied by officials who
do not have the spirit of nationalism
and the spirit of Pancasila.
Based on the explanation above, the national
economic system, juridically formally in its galib, has been mandated in the 1945 Constitution in Article 33, and this is
the total application of the fifth
precept of Pancasila. The founding fathers of this nation
have clearly formulated the Indonesian economic system, namely the Pancasila economic system, but not the socialist
economic system and not the capitalist
economic system. Furthermore, the implementation of the Pancasila Economy in the current era of globalization is faced with
a variety of
multidimensional challenges and
obstacles. Exotic global competition, the entry of foreign
cultures, technological advances and digital transformation are all serious challenges that must be
anticipated and overcome. To overcome this problem, the government is obliged
to make a strategy to take
anticipatory steps that begin with
establishing cooperative relations between the private sector,
the government and the community.
In addition, the government is required
to carry out various innovative,
adaptive policies based on the
essence of the precepts of
Pancasila, so that the integrity of
the Pancasila economy in welcoming competition at the increasingly
superior global level can be
well maintained.
The Impact of
the Implementation of the Family-Based
Pancasila Economic System
National economic development needs to be carried out
in harmony with all the precepts of Pancasila, namely the realization
of the principle of justice
for every citizen, and the
impact of the rate of
economic growth can be felt
to achieve the prosperity of the Indonesian people. National economic development must be carried out according to
a family-based economic system based on
the spirit of Pancasila and the Indonesian state constitution. Planned and integrated national economic development will create a quality of life on
par with other countries. Therefore, for the development
of the national
economy, the implementation of Pancasila economic democracy must always be realized based on a sense of kinship,
Basically, in Article
33 of the 1945 Constitution of the Republic of Indonesia, paragraph (1), paragraph (2), and paragraph (3), the Economic Philosophy
is contained, namely the principle
of family. The family philosophy in question is a social
philosophy that is contrary to
individualism, socialism, collectivism and radicalism
Hatta, who first laid the foundations of the Indonesian economy, emphasized that the principle of
unity in cooperatives is a guideline for the national
economy. History records that before
the amendment of the 1945 Constitution,
in principle, the national economy was based on
the principle of kinship, and
one of the
forms was cooperatives. In another part, Hatta, the originator of his idea, described cooperatives as joint ventures that are synonymous with the culture of
Indonesia
Actually, the pace of the economy
is controlled by the moral and
social reactions of the community,
meaning that economic activities come from patterns
and values of positive thinking
that manifest rather than core
values and are implemented in economic activities. The basic principles of economics
are obtained from moral values such as the spirit of community,
mutual cooperation, self-control, and tolerance. So that
economic activities can only be
achieved based on these fundamental values. In another sense, where every
person and or whoever he is, he is not justified as a tool or means
only to meet
the demands of profit, on the
contrary, all economic activities are solely for the
sake of glorifying human beings. What is meant by
egalitarianism here is social equality
which presupposes the realization of a sense of
family, mutual love for fellow
citizens, and the spirit of solidarity. The history of the Indonesian economy records that every citizen
has a high level of solidarity when they have a sense
of solidarity, but on the
contrary, when each individual lives in abundance, their sense of unity
and unity is weakened, and
this means that the community
always lives in suffering without a sense of solidarity
with others
Indonesian society, whose ideology is Pancasila as the core value of life, believes
that the morality of economic life is based on the morality of Pancasila. The State of
Indonesia justifies the rights and existence
of six religions
and also religious traditions as mandated in Article 29, paragraph 2 of the 1945 Constitution. The teachings about the value of
goodness are obtained from religion. Even in it it is
implied that the traditional cultural values of the Indonesian people come from
all tribes which are marked by the creation
of tolerance to achieve common
targets. So the goal of
achieving social equality with justice
is for the
realization of the welfare of
the Indonesian people based on the
essence of democratic humanity that is overwhelmed
by the spirit of nationalism. In addition,
when viewed from the principles
and principles used, both the
principles and principles of cooperation, property rights, and government
intervention synergize with each other
Mubyarto in Kompas,
2003, the Pancasila economy
is a market economy based on
the ideology of Pancasila. This means that the
mechanism of economic movement refers to real data from economic achievements
and the actions
of economists who prioritize ethics, social and democratization
The Pancasila economy has a strategic role as the backbone of
the short-, medium-, and long-term development of the Indonesian state. The Pancasila economic system adopted by the Indonesian people is ideal to achieve a just
and prosperous society. It is
very different from the liberal economic system that prioritizes individualism over the larger interests of the wider
community. Likewise, the socialist economic
system is only concerned with certain groups
but oppresses individual rights. Pancasilais starts from humans in general and subjectively
is human beings as well. Therefore, the Pancasila economy should be spread
into a system based on sustainable
development and a family-based economy so that it
can realize welfare for all
citizens. In principle, the economic system
in Indonesia cannot avoid a
sense of humanity, therefore development in the economic sector must reject and
dispel all forms of unfair
competition, and monopolistic behavior that can give
birth to acts of oppression,
injustice, and the occurrence of misery and
suffering for all levels of
society. Pancasila as a variant of economic development, is more inclined to
the fourth precept, while economic development refers more to the
progress of Indonesia's reliable and beneficial economic system
Based on the description above, it can
be stated that planned and integrated
national economic development will create an equal distribution of the country's quality of life. Therefore, to build the country's economy, the implementation of
Pancasila economic democracy
must always be carried out on a familial basis. The mechanism of the Pancasila Economy is based on
real data on the Indonesian
economy and ethical, social, and democratic actions by economic
actors.
History shows that before the amendment of the 1945 Constitution, the economy was based
on the principle
of kinship, the economic system
was developed into an economic
system based on sustainable development based on family so
as to bring prosperity to all
Indonesian people. It can be emphasized
that the economic system based on Pancasila is a family-based people's economic system.
Conclusion
The implementation of the Pancasila economic system in sustainable development requires a strategy that ensures government
involvement in setting short, medium, and long-term development directions and policies. The goal of sustainable
development based on the Pancasila economic system requires a strong theoretical foundation so that stakeholders
can understand and apply the
concept of sustainability, formulate strategies, and achieve development goals. The challenges of implementing the Pancasila economic system in the era of globalization are increasingly complex with global competition, the entry of
foreign cultures, advanced technology, and digital transformation. To overcome this challenge,
collaboration between the private sector,
the government, and the community
is needed, as well as innovative and adaptive policies
based on Pancasila values so that
economic consistency is maintained. The Pancasila economic system designed by the
nation's founders is different from
capitalism that relies on individuals
and markets, as well as socialism with state domination,
but prioritizes the participation of the people
through the principles of kinship,
mutual cooperation, and cooperation. Sustainable, planned, and integrated national economic development will present the principles
of justice and equitable distribution
of quality of life. In order to improve the
country's economy, it is necessary
to apply Pancasila economic democracy based on the
principle of kinship, where the sustainability of this system
refers to real data on economic achievements
through ethical, democratic, and social actions. Before the amendment
of the 1945 Constitution, the Pancasila-based economic system existed and took place,
so that all
Indonesian citizens could enjoy a fair and
equitable family-based people's economic system.
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Amstrong Harefa, Jesslyn Elisandra Harefa (2024) |
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First publication right: Advances in Social Humanities Research |
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