From an early age, Indonesians have long been taught a familiar financial principle: live frugally and save money. This advice is often regarded as the key to financial security and even prosperity. In reality, however, frugality in Indonesia is not merely a matter of personal discipline. Historical patterns suggest that thrift has never fully developed into a strong social value.

Historian Ong Hok Ham highlighted this issue in 1986. In an interview with Kompas (February 10, 1986), Ong observed that Indonesian society had traditionally recognized only two contrasting ways of life: one of luxury and one of poverty. Between these extremes, the notion of modest and economical living found little space.

Ong argued that the roots of this issue lie in the country’s pre-1900 social history. At that time, Java’s population was relatively small, making social bonds essential. These bonds were reinforced through the exchange of tributes, gifts, privileges, and social status. Once such obligations were fulfilled, loyalty and security were ensured—a pattern that persisted beyond its original context.

As society entered the modern era, these social ties evolved into forms of social investment, serving both short-term and long-term interests. Giving was no longer merely an expression of loyalty but became a means of preserving status and maintaining relationships within the social hierarchy.

For affluent groups, such practices posed little burden. For the poor, however, social expectations became an unavoidable pressure. In this context, poverty did not exempt individuals from social obligations, making frugality difficult, if not impossible, to practice.

This dynamic is evident in everyday life, where spending often arises not from personal necessity but from social demands—hosting guests, giving gifts, or holding lavish celebrations despite limited means. Such obligations frequently come at the expense of household financial stability.

Ong’s perspective also served as a critique of government policy during a period of economic hardship. In January 1986, President Soeharto urged all segments of society to adopt a modest and frugal lifestyle as a response to the economic crisis. He emphasized that simplicity was not only expected of government officials but also constituted a moral responsibility for the broader public, particularly the wealthy.

However, the call drew criticism due to the lack of example from those in power. Many officials and wealthy individuals continued to live extravagantly, including hosting events at luxury hotels.

Ultimately, Indonesia’s economic recovery was driven not by appeals for frugality alone, but by deregulation policies that stimulated exports and investment. By the late 1980s, the national economy had regained stability.