An assessment of Indonesia's vital role in U.S. interests in Southeast Asia (SEA), which warrants a substantial increase in U.S. aid. Indonesia's strategic location is important toward stabilizing SEA, since she could oppose Chinese and Soviet aggression and help smaller nations to combat guerrilla warfare based on subversion and insurgency. However, Indonesia is unstable economically and politically, and is in danger of attack by both extremes of dissident youth, due to hyperinflation, government impotence, and destruction of the moderate values supporting the regime. The Indonesian Army has failed in its program to obtain popular support because of a national state of depression and a lack of resources and methodology. The United States should increase its economic aid (currently less than one-half of one percent of security expenditures in SEA) to support the Army's program, and, within Title IX intents, the United States should undertake research to enable a mobilization of the populace to release its latent energies. 14 pp.