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By Juan T. Gatbonton, Editorial Consultant
Corruption is the most common example of the
“tragedy of the commons”—the despoiling of a collectively
owned institution that provides public goods. Like the village
pasture, the state is owned by everyone and by no one. And because
everyone would profit if government were better-run, most people
choose reasonably to “free-ride” on the efforts of more militant
citizens such as Jun Lozada and Joey de Venecia 3rd, who elect to
bear the private costs (in various aggravations) of political
reform.
But even so, civil society—in Thailand,
Malaysia, Indonesia and China, as well as in our own country—now
seems angry enough at the magnitude of corruption to cry out against
it.
Why so widespread?
Why has corruption become so widespread and so
gross?
The simplest reason is the unprecedented
opportunity for rent-seeking and crony capitalism that state
interventionism in today’s economies creates. Economic
modernization in our time requires a greater degree of government
direction and control than when the West industrialized under
laissez-faire capitalism. And our typically weak states cannot
prevent interest groups from “capturing” interventionist
policies for their private benefit.
Rates of growth the new countries have reached
are unparalleled. America, between 1835 and 1985, doubled individual
incomes every 47 years. China, between 1978 and 1995, doubled
incomes in less than eight years. Weak legal systems side by side
with such rapid expansion create huge opportunities for
rent-seeking.
The impoverished state also creates
opportunities for corruption. Indonesia pays barely a third of what
it costs to maintain its military: local commanders must make up the
difference by generating “off-budget” revenues.
So do specific policies and constitutional
limits. Malaysia’s “affirmative-action” policy to raise the
Malay majority’s stake in the economy generated—as a
by-product—cronyism and the debauching of public corporations.
Here at home, the “no re-election” rule for the president has
weakened the accountability principle, which is at bottom enforced
by the popular vote.
Cash for votes
Widespread transitions to the representative
system have also made corruption more visible—hence more
offensive—to citizens. The advent of mass politics has sharpened
politicians’ need to feed their electoral machines. While the
weakening of the social contract—under which the patron
distributes benefits to his clients in exchange for their
deference—has made elections outright exchanges of cash for votes.
All too often, the problem of corruption is
simply that of underpaid officials possessing wide discretionary
powers over the conduct of business.
In most poor countries, corruption has become so
commonplace that business people regard bribes as a kind of
transaction cost—an informal “user’s tax” of the
bureaucracy. Some academics go as far as to argue that “rent and
corruption [are] essential to the credible enforcement of
contracts” in the weak state.
The Philippine state has historically been weak
and ineffective. Neither the Spaniards nor the Americans established
colonial bureaucracies comparable to those set up by the British,
the Dutch, the French and the Japanese. And very little has been
done to professionalize the civil service these past 60 years.
So that Philippine development must rely, much
more than its neighbors do, on the interplay of market forces.
Curbing corruption
The collateral costs of eradicating political
corruption would probably be too high for most peoples to bear. But
it can be moderately checked—and confined to the peripheries of
government. One obvious way is to limit state
interventionism—deregulate the economy as soon as it is vigorous
enough—spur competition—and allow the market more leeway.
Over 1992 to 98, President Fidel Ramos had
modest success in tariff reform and market opening—in breaking up
the most blatant monopolies and cartels—and in getting government
out of business.
Two of Ramos’s political allies, Congressman
Jose de Venecia Jr. and Senator Edgardo Angara, even made a stab at
reducing the influence of “money politics”—by proposing a
measure of public financing for mainstream parties in the context of
their reformation.
Why is reform so difficult?
Reform is difficult because its costs must be
paid before its benefits become palpable. And these costs must be
paid by the rich families that have historically benefited from
their influence on the political economy—while its benefits are
diffused and its beneficiaries are largely the inarticulate masses
of everyday people.
Indeed even ordinary citizens are hurt by the
initial reform processes—in higher prices, the ending of state
subsidies, and joblessness, as once-coddled “infant industries”
are exposed to heightened competition.
In the transitional democracies, the central
task in the struggle against corruption must be to build up state
capacity—because development needs an effective state, disciplined
bureaucrats, stable policies, and a predictable legal order.
Political institutions must promote accountability in officials, and
greater openness in public transactions.
In the end, the struggle against political
corruption is an endless one—not only in new countries but
everywhere in the world. Good government is no more than an ideal.
It involves long-maturing internal processes, and even the most
mature states have room for improvement.
Notes & Comment appears fortnightly in
The Manila Times
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