Time to clear the underbrush of bribery
Stories telling how employees of the just shuttered 鈥淭he News of the World鈥� newspaper in Britain had possibly colluded with Scotland Yard in inappropriate ways, including payments to police, are just one recent troubling example of corruption in business and government. One need only Google 鈥渂ribery鈥� for plenty of other fresh examples around the world.
Ironically, Britain just put into effect July 1 a new Bribery Act that aims to clean up its ways of operating. It鈥檚 the latest follow up to the US Foreign Corrupt Practices Act of 1977, which has had a worldwide effect by demanding that US businesses not pay bribes overseas.
The extent of global corruption is undoubtedly massive, though hard to quantify. How much more does a project cost because of invisible bribes? What worthless 鈥渨hite elephant鈥� projects are approved?
Such corruption can scare away foreign investment and reduce economic growth. A corrupt country鈥檚 economic growth rate can be .5 to 1 percentage points lower than that of a similar country with low corruption, according to the World Bank.
Exact figures on losses from corruption can be elusive, but from time to time some numbers have been put forward. For example, China鈥檚 central bank recently estimated that more than $120 billion had been stolen by employees of government enterprises since the mid-1990s.
Now for the good news: Governments and civic activists are recognizing the need to combat bribery 鈥� and vigorously.
Governments have only to look to the streets of the Arab world where outrage over government corruption has inspired angry protests and even toppled rulers.
In the world鈥檚 two most populous countries, China and India, hundreds of millions of people expect to be lifted out of their poverty through economic growth. Officials in both countries are recognizing that corruption will hold them back.
鈥淲e must create the conditions in which the people can supervise and criticize the government ... so as to prevent corruption from developing,鈥� Chinese Premier Wen Jiabao said in June. 鈥淐orruption will cost the party the support and trust of the people,鈥� chimed in China鈥檚 President Hu Jintao July 1, adding 鈥淲e must not turn our power into an instrument for making personal gain for a handful of individuals. It is more urgent than ever for the party to impose discipline on its members.鈥�
While crackdowns in China on corruption at the local level have been tolerated 鈥� and even encouraged 鈥� in the past, what remains to be seen is whether a housecleaning can take place at the higher levels of Chinese government.
In India, Prime Minister Manmohan Singh has attacked business leaders for their 鈥渆thical deficit鈥� that could harm the nation鈥檚 drive to become an economic superpower. 鈥淥ur corporate culture must be attuned to the universally accepted values of good governance,鈥� he said.
No doubt this was a 鈥減ot calling the kettle black鈥� moment, since the Indian government itself remains torn by various scandals. Still it represented an effort to recognize the destructive influence of corruption. India鈥檚 Chamber of Commerce didn鈥檛 disagree, itself saying that 鈥渂rand India鈥� could be damaged in the world鈥檚 eyes if 鈥渂razen acts of corruption鈥� were not addressed.
In India last year, a private group set up the website 鈥淚 Paid a Bribe鈥� in order to shed light on incidences of bribery throughout Indian society. This effort at harnessing social media has been an early success, with more than 12,000 incidents of bribery already reported on the site along with some evidence that officials are responding.
The site confirms what has long been known: At the individual level, generally it鈥檚 the poor who are forced to pay bribes to those who are wealthier and more powerful.
Helped by the Internet, citizens are becoming better watchdogs. Combined with the efforts of governments, the picture is slowly brightening.
鈥淚t is heartening that so many people are ready to take a stand against corruption,鈥� Huguette Labelle, the chairwoman of Transparency International, said late last year. 鈥淭his willingness must be mobilized.鈥�
At its heart, the issue is honesty. Honesty is not only the basis of good business, it鈥檚 the basis of good politics, including the maintenance of harmonious relations between countries.
The path out of the world鈥檚 current economic doldrums will become clearer as governments, businesses, and individuals clear away the underbrush of bribery and corruption.
