This work stars with an overview of bublic education this includes goverment policies issues and debates that show the evolution of bublic education that moved form its position as part of religious institution into state main agenda. In particular it focuses on the relationship between state policies and public education in Indonesia from centralistic state policies of New Order regine to more open policies in the era of reformation. However under New Order the Indonesian state took bold steps to build state schools bureaucracy and institutions. In the reformation area the state takes ambivalence policy on one side keeps education as part of bureaucrat arena nad on the other side tends to let the market forces work. As the country sources of income dry up the market forces become more dominant and the Neo-Liberal paradigm is the safety valve.