The slippery slope of corruption


by Prabhudev Konana

Greater transparency, accountability, enforcement, and self-governance are essential to control the malaise. 

An influential friend of mine once said that bribing someone with a briefcase full of cash is something that happens only in old movies: it was a thing of the past. But now cash is being taken in suitcases and gunny bags in vans to be paid as bribe. The new wealth and prosperity are, in fact, feeding a frenzy of corruption that is quickly causing the decay of societal morals and ethics. Even the national honour is up for auction in hosting the Commonwealth Games. A nation that aspires to be a superpower cannot take pride in its abysmal 84th place in the corruption perception index as measured by Transparency International.



Bribing is now considered an investment by many who seek government jobs. This investment, they assume, gives them a moral right to expect a return through more corruption. The public “servants” who dole it out seek greater investment. The honest and the financially weak often exit the government sector, only to reinforce this belief. The bureaucratic hierarchy itself is established based on the extent to which one can engage in corrupt practices, rather than on merit and honesty. The honest few with the determination to fight the system are either transferred to inconsequential roles or remain dejected and angry. The unabated corruption strengthens the power of public servants — which is truly a slippery slope.



For citizens and businesses, it is faster and more efficient to engage in immoral and illegal activities in their interactions with government. Those who can, or are willing to, engage in such activities are likely to have fewer headaches and greater rewards. There is academic literature that argues that bribing as a means to achieve ends in an environment of pervasive corruption and archaic policies actually helps growth. But the system penalises honest and weak citizens by means of bureaucratic delaying tactics.



A recent visit to certain industrial units in Bangalore was illuminating. Factory owners, it was found, resort to an annual ritual of bribing numerous government inspectors — those who handle factories and boilers, pollution, labour, excise levies and so on. It is a rational decision since this makes things cheaper and faster. The choice is between spending countless days providing every minute detail to the inspectors, some of whom expect fair “compensation” for being there, or focussing on one's core business. One business owner told me that the inspectors themselves were expected to share their bounty along the hierarchy; else they would be pursued negatively by others. The irony here is that government “servants” who are supposed to facilitate economic activity act as “masters” of businesses.



It is unfair to blame all the problems on the government. A not-too-trivial fraction of private citizens and business owners are equally responsible for the situation, and private sector corruption could be dwarfing government-led corruption — we will never know. Private entities transact on an all-cash basis in order to avoid paying taxes. Some business owners exploit labour without paying fair wages or subjecting them to pollutants and harsh working conditions. They inflate invoices for government subsidies or contracts. Some businesses receive thousands of acres of prime land at a fraction of the market value. A few businesses illegally tap into the electricity grid or tamper with electrical meters. A significant fraction of residential buildings do not conform to planning regulations. Businesses are set up without permits. Innocent farmers are exploited and stripped of their land at rates that are much below the market value — often with the help of the heavy-handedness by the government. The private sector flouts rules and regulations, feeding more corruption.



To prevent the exploitation of the system, the law-makers — who are part of the corrupt system — introduce greater regulations, inspections, and restrictions, without recognising that adding so-called “oversight” leads to even greater potential for corruption. Hernando de Soto, the Peruvian economist, famously said in his seminal book Mystery of Capital: Why Capitalism Thrives in the West and Fails Everywhere Else, that in most countries “it is very nearly as difficult to stay legal as it is to become legal.” He stated this in the context of private property rights and bureaucratic hurdles, but it applies to every aspect of government transactions.



Therefore, regulations are a double-edge sword. On the contrary, pursuing the perpetrators of corruption has been a comical exercise. In Karnataka, for example, less than 10 per cent of the government officials who were caught red-handed accepting bribes has been prosecuted. Even the laws are changed to make it harder to prosecute the culprits.



Maybe there is a need to think differently to put a lid on corruption and hopefully push it down incrementally.



Broken Window Syndrome

There is hope for improvement, and some clues can be found in my experience at the new Bengaluru International Airport. The once congested and dingy old airport, where clearing immigration and customs, collecting baggage, and using the toilet were severe challenges, has been replaced by a clean and spacious airport. Immigration and customs clearance are fast (except for those confusing forms), respectful, and organised. There is little corruption or bureaucratic nuisance. Why have attitudes changed?



Some argue that the numerous security cameras installed there prevent officials from engaging in corruption. Some suspect that training, higher salaries, and better governance including complaint services have lowered corruption. Maybe it is the new environment: clean and nice cubicles with computers bring forth a new attitude. It could be that people standing in queues treat government officials with respect and decency. It is possible that there is pride in projecting a positive image of the country. A significant fraction of the workforce being younger and probably untainted by corruption, may have contributed to the changing attitude.



There are many variables. But, the behaviour in the old, dingy airport supports the Broken Window Syndrome first studied by James Wilson and George Kelling in housing projects (government housing for economically poor families) in New York. They argued that when a window is broken in a building and it is not fixed, then over time the rest of the windows will be broken and soon that building will be infested with plunderers, leading to social breakdown. This can be applied to a building or a community at large. When a neighbour throws garbage in a street corner, everyone else will pursue it as fair game and quickly dump more garbage as there is no perceived cost. The same applies in the matter of observing traffic signals. Socially imposed regulations cease and disorder becomes the norm — to the great dissatisfaction of law-abiding citizens.



The new airport implodes those norms of broken windows and creates a modern vision for employees to respect. Let us hope we can replicate some of that in thousands of government buildings, hospitals, and railway and bus stations.



If security cameras can contribute to lowering corruption, then why not record all government-citizen interactions? There are costs, but it is worth the effort to put a lid on this moral decay. Maybe, honest neutral observers can be witness to government-citizen interactions. There are possibilities for corruption to occur by other means, but at least the honest ones are troubled less.



There is another point of view to reduce corruption. Stringent rules create corruption. When Customs duties on small electronic items were exorbitant and exemptions were available only to the extent of a few hundred rupees, both travellers and Customs officials found a common ground to bypass the rules through corruption. With higher exemptions in place and free import of gadgets such as laptops now, the opportunity for corruption has radically decreased. Maybe, rules must be designed to prevent incentives to cheat.



If corruption has to be controlled, there needs to be greater transparency, accountability, enforcement, and self-governance. All these are difficult to achieve, and require experimentation and different thinking. The slippery slope of corruption has a powerful downdraft where the weak and the honest suffer the most. Let us hope that the political, business, and bureaucratic establishments, with the help of pressure from the media and the citizenry, will wake up to fix the broken window of corruption.



(Prabhudev Konana is William H. Seay Centennial Professor and Distinguished Teaching Professor at the University of Texas at Austin: pkonana@mail.utexas.edu