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Most people focus on the petty corruption of low paid civil servants, not the grand corruption of wealthy multinationals. Much of the focus is on symptoms such as missing resources, and not on causes such as regulation of state enterprises. Most of the talk is about the bribe takers, not the bribe givers.
~ Sue Hawley
In his above statement regarding corruption, Hawley’s main point is that when people generally think of corruption they think of it on a small scale. For example, when thinking of corruption, most people think of corrupt police officers in Mexico and Russia who steal brides from people. They never think about the rich corporation sitting in power that they are corrupt. I myself was guilty of this. As an immigrant from the former Soviet Union I have seen a lot of the “petty corruption by low paid civil servants” that Hawley is referring to. It is widespread in Russia and everyone knows that it exists. I didn’t know about the “grand corruption of wealthy multinationals” until I took this poverty class and read the “Export Corruption” paper. I was under the illusion that only developing countries are facing corruption and I thought that no corruption exists in the north. Hawley offered lots of good examples that have convinced me otherwise.
The first example of the type of corruption operating in the “North” is bribery to gain contracts or concessions, and sometimes to avoid environmental regulations. Western businesses disguise these kickbacks as quasi-legal fees or commissions, which sometimes make them difficult to detect. They also do not participate directly in this but use local agents to get the work done. This way they keep their hands clean and do everything in secrecy.
Privatization is another form of mega-corruption by wealthy MNCs. This could take the form of “major public sector contracts and concessions issued to private companies”. By selling off state-owned enterprises to private owners, the government has accumulated huge amounts of money at the expense of the poor. The benefits of this privatization were overestimated and the costs underestimated. Many times the World Bank and IMF are contributing to corruption as rules have not been established to control privatization. Due to lack of rules, corruption is allowed to flourish without anyone doing anything.
Other examples of corruption by the West are liberalization that is not carefully managed, private banking and offshore banks that hide Third World assets and decentralization that “does not provide local governments with adequate resources and training”. It is easy to understand from these examples that the biggest corruption in the world is happening in the North. The $80 billion a year that Western businesses pay in bribes is far worse than the average police officer in Russia or any other country considered corrupt. Hugh Beckey called bribery “the direct transfer of wealth from the poor to the rich”. Regular people who participate in corruption in developing countries sometimes have to do so in order to survive. His country is poor to such an extent that even his salary is not enough for his survival. One of the reasons for this poverty is the corruption prevailing in the West.
Following these examples given by Hawley, I see that the answer’s excuse for not forgiving poor countries’ debt because of corruption does not hold up. The corruption taking place in their own country is on a much larger scale than the corruption taking place in the developing countries. The biggest problem is that people don’t understand what true corruption looks like, which is why they are vulnerable to the illusion that I was in just before reading this paper.
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