Now that Im home and I can get a little more into this in detail.
Obama's mother Stanley Ann Dunham married Lolo Soetoro. Ann Dunham worked for "U.S. Agency for International Development (USAID)" that worked to gather 5000 key members of the Indonesian Communist Party which Lolo Soetoro was a part of. These people were all targets of the Indonesian Military. USAID would also identify Indonesian sympathizers of the goverment.
The coup (which Lolo took part of) took place backed by support of USAID and the CIA in 1965 where they took out President Sukarno and net total deaths in the coup were between 250,000-1,000,000 Indonesians.
The source to the CIA's role in the Indonesian Coup was written by a CIA vet of the International Communism Branch and part of the Counterintelligence staff Ralph McGehee in the Fall 1990 issue of the Covert Action Information Bulletin.
Lolo Soetoro was named colonel under the newly CIA installed dictator General Suharto from 1965 (after he married Obama's mother, which he then left both Obama and Durham in Hawaii afterwards) to 1970 when he became a oil millionaire joining Exxon.
Ann Dunham worked for the CIA/USAID front, Lembaga Persahabatan Indonesia Amerika (LIA)-the Indonesia-America Friendship Institute up until 1972 when she returned to Hawaii and continued her work under two agency fronts, the Asia Foundation and the East-West Center at the University of Hawaii. She returned to Indonesia in 1975 the same year East Timor became independent and liberated from Portugal and the CIA along with Lolo Soetoro planned a bloody invasion and occupation of the country with permission of Henry Kissenger (who is now one of Obama's policy advisor)
For more information on Genocide in East Timor you can look into the "East Timor Genocide Studies Program"
http://www.yale.edu/gsp/east_timor/
Yale East Timor Project - Yale University Genocide Studies Program
UN-sponsored Truth Commission Verdict on East Timor:
"Extermination as a Crime Against Humanity"
Full Report US Role Databases
Dili burning, September 8, 1999
Violence by Fire in East Timor, September 8, 1999
Other Satellite Images of East Timor, 1972-2000
Map of East Timor's Districts and Resistance Sectors, 1975-99
Ill post more later if I have time, havent touched Obama's grandfather yet.