“Bribery and Corruption”: Are there really such things?

Joseph Cruickshank, Menasha, Wisconsin, USA.

The term “bribery and corruption” is used to depict the act of public officials accepting remuneration outside official channels for official acts. It is generally considered a cancer in the social order or some such other abhorrent disease so that “rooting out corruption” is to a political campaign what “curing cancer” would be at a medical convention. It elicits loud applause and establishes the bona fides of the politician as being on the correct side of the moral divide. Who, indeed, would be for “bribery and corruption”, but the vilest of individuals with no shame, certainly not fit for the lowliest position in the public service realm.

There may be no doubt in certain quarters that this historical view of these twin “evils” is justified. The aim of this article, however, is to suggest that no matter how solidly engrained and publicly accepted particular views may be, they need to be revisited and to be put under the knife, so to speak, of critical analysis periodically: that no matter how uncomfortable or painful such autopsy may be, such periodic re-examinations are the only way to make sure that, indeed, such long held “wisdoms” of the ages can stand up to the test of the current tools of intellectual inquiry and critical analysis.

Being quite aware of the sensitivity in certain quarters regarding this subject let me be clear on one point. I am an engineer by training. I have not served a day in any public position. In my own career, mostly in the United States, I have never bribed anybody or accepted or been in the position to accept a bribe. I realize that in certain quarters, such an article, daring to possibly challenge this long established wisdom, would be akin to an article justifying rape, which could only supposedly, be written by a guilt–ridden rapist. Indeed the analogy is most appropriate since bribery and corruption are seen as akin to raping a country. I hope your readers, however, will follow the logic of this article and begin the process, not necessarily of accepting my arguments here, but of starting to question other long held positions using the tools of modern critical analysis.

So why would “bribery and corruption” not necessarily qualify for their slimy status within the body politic that they have long held? I submit two arguments in favor of this proposition. The first one comes from the concepts of modern economic theory: from the laws of “supply and demand” and equilibrium pricing. The second is from legal theory: what is legal may not necessarily be right. The converse is also true. What is illegal may not necessarily be wrong.

Let us consider the economic arguments first. Modern micro-economic theory is well known and so I will not waste the time of your readers expounding on the concept of supply and demand. What I will say is that clearly bribery arises when the price of a service to be provided by a public official is well below the inherent value of the service to the receiver of the service. As an example, let us consider the issuance of passports to a traveler. The traveler clearly attaches a certain economic value to his/her being able to travel to the destination of interest. Even if the trip is only for emotional purposes (to see a new grandchild, for example), a certain “cost” can be associated with not being able to make the trip. The cost of the service of supplying the traveler with the passport is generally thought of as being the cost of the passport itself. The true cost, however, includes cost of the sense of a lack of economic security of the official supplying the passport, the sense of being left behind by the economic train. If in his view, his remuneration for this activity is well below his perception of the value of the passport to the recipient, he may choose to “raise” the price of the passport to its true market value by imposing a fee on the traveler. This is what qualifies for bribery and is roundly condemned by all.

This concept easily explains the relatively rare cases of bribery in the Western world. Let me not be misunderstood. There IS bribery and corruption in the West. The fact, though, is that in the day-to-day dealings with officialdom in, say, the United States, the vast majority of transactions are free of this added cost, hence the false perception that bribery is mostly a Third World, or worse, mostly an African phenomenon. This apparent rarity of bribery in the West is very easily explained using the concepts outlined above. A US Highway Patrol Officer, for example, is paid sufficiently with enough benefits and has a high enough sense of economic security, that accepting a bribe from a traffic law violator does not add significantly to his economic well-being. Indeed, the marginal cost to him of losing his job is greater than any realistic bribe he can impose on or accept from a traffic law violator. In short, American Police Officers, generally speaking, do not accept bribes, not because it is illegal to do so (which it is everywhere, including Ghana) or that they have a higher sense of duty and morals than their Ghanaian counterparts (which I do not believe for a second), but because, conscious or sub-conscious evaluations of the economic benefits of accepting a bribe produce a “not-worth-it” result.

I could give numerous examples of the micro-economic basis for the prevalence of bribery in Africa, but we have only limited space here. I will now move to the legal theory aspects of the problem. As I stated earlier, what is legal, may not necessarily be right and vice versa. It is usual though, except in rare case, for ordinary citizens to confuse the two and to assume that if something is legal then it must be right, and if it is illegal then it must be wrong. Prostitution is a good example of this. The very same activity is legal (and presumably right in Amsterdam), but illegal (and presumably wrong in Chicago. Go figure) In the case of bribery and corruption, the perception of prevalence of bribery in Africa and its supposed rarity in the West, is the result of this legal sleight of hand.

The way this perception is maintained in the USA is by legalizing and legitimizing practices that would be deemed as bribery in other countries. The legions of lobbyist swarming Capitol Hill and dispensing so-called campaign contributions would be thrown in jail in other countries. The difference is that in the U.S, it is allowed by law and regulated by law. This is a critical point. Just as with prostitution in Holland, sometimes, the best way to deal with an activity, which will be pursued regardless of the outcry, is to legalize and regulate it (see marijuana, again in Amsterdam).

I conclude by proposing, based on the analysis above that we do the following to minimize the so-called bribery and corruption that we expend so much energy waging a losing battle against. 1. For lower level public officers, the government must raise salaries, wages and benefits significantly, so that the risk of losing one’s job if caught accepting bribes becomes prohibitive. 2. If this is not possible, due to budget constraints, then the government must establish specific added fees, published so that there is no mystery as to the amount and intent. Such fees or taxes must be calculated such as to close the gap between the perceived value of a service and the actual cost to the provider of that service for providing it. It could then be used to subsidize the salaries of the service providers, with the understanding that any bribes taken beyond this would meet with the severest punishment, including termination. There would be an incentive for the public to report violators, because they would now feel, if they had to pay a bribe, that they are paying more for a service than the service was worth and would not only turn down the service, they would have an incentive to turn in the violator. 3. We must define and legalize and put out in the public domain, most of the activities of high-level politicians and Ministers that currently take place under the table and create the perception of corruption and favoritism that saps the public mood. If Ministers are inclined to take a 10% cut on a contract, then make it part of the remunerations and publish regularly, such payments. Such openness might even discourage a few ministers from doing it and the taint of corruption and the incessant preaching from the West will go away with it.

The point of these suggestions is to emphasize that “bribery and corruption” are signs not so much of a moral failure unique to Africans as it is made out to be by our Western detractors, but are a result of the lack of appreciation on our part of the power of modern economic and legal theories to help solve societal problems of this kind. Generally speaking, such economic misalignments (which is really what bribery is when shorn of it’s moralistic taint) are no different from other economic misalignments and can and must first and foremost be addressed using the power of economic analysis and modern legal theories and practices.

In short, I submit that there is no such thing as “bribery and corruption”, only incorrect functioning of the pricing, resource allocation and legal mechanisms within our societies. It is no wonder that the highest level of corruption appears to exist in countries that do not have a long history of market based pricing (China, Russia, most African countries) and that the smell of corruption hovers the least over the West, the home of Adam Smith.