Luis Rubio

When he was a comedian on television in Guatemala, Jimmy Morales, garbed in a prison inmate’s uniform,  criticized the corruption of the politicians, accusing them of being atheists and not being able to imagine a better life than that deriving from the reigning corruption. Three years later, as President of Guatemala, Morales’s son and brother were accused of corruption. Nothing new under the sun. Corruption is an endemic vice that affects nearly all nations of the world, but its manifestations and effects change from country to country.

Yuen Yuen Ang, a university professor who is an expert on China, affirms that everyone supposes that corruption affects economic growth, but evidence in this regard is tenuous. After analyzing and comparing dozens of lands over time, her conclusion is that corruption changes as countries develop and that some achieve its eradication almost entirely. In her book, China’s Gilded Age, Ang concludes that what distinguishes this nation has been its capacity to attain such high growth rates for several decades despite the enormous corruption characterizing it. Ang’s analysis is particularly relevant for Mexico.

Corruption is conventionally defined as: “the abuse of public office for private gain” that, says the author, includes too many types of corruption, clouding over more than clarifying, because not all varieties hamper growth, thus explaining differences among nations regarding what this phenomenon entails. Elucidating the differences permits understanding the impacts that corruption exerts and explains why it persists in many nations, on occasion legally or, de facto, legalized.

Ang thus differentiates between corruption involving exchanges between governmental officials and social actors (including bribes) from corruption that involves robbery, embezzlement and extorsion. To the latter she adds a second dimension for telling apart the nature of the actors involved: politicians and social leaders (in a broad sense) are not the same as low-range functionaries like police officers, customs officials, inspectors, and governmental office workers. This dimension allows for discerning between the bribes an ordinary person offers to facilitate a procedure and great decisions at the governmental level where funds, contracts, concessions, and other valuable resources are allotted concerning those over which the government has jurisdiction.

Based on these categories, Ang comes to define four types of corruption: a) petty theft: “acts of stealing, misuse of public funds, or extorsion among street-level bureaucrats” (that affects ordinary citizens on their interacting with lower-level functionaries or police officers); b) grand theft: “embezzlement or misappropriation of large sums of public monies by political elites who control state finances” (treasury theft through the over-invoicing of governmental purchases or other, similar mechanisms; c) speed money: “petty bribes that companies or citizens pay to bureaucrats to get around hurdles or speed things up” (“gratuities” that people employ to enable a process, the product of cumbersome requisites and abusive inspectors; and d) access money, which “encompasses high-stake rewards by business actors to powerful officials, not just for speed, but access to exclusive, private privileges” (expensive gifts, bribes, the profit-sharing of a project in exchange for extraordinarily profitable favors). “Whereas the first three categories are almost always illegal, access can encompass both illegal (e.g., massive graft) and legal access (e.g., political finance and lobbying).” Illegal categories can be great bribes, but access can involve “ambiguous exchanges or completely legal ones that do not involve bribes” such as connections, campaign financing, influence peddling, etc.

Jagdish Bhagwati, an Economics professor, said that once there was an idea, now mostly forgotten, that the “tortoise” India could eventually overtake the “hare” –China. “That’s an exaggeration, I think”, he says. “A crucial difference between the two countries is the type of corruption they have. India´s is classic “rent-seeking”, where people jostle to grab a cut of existing wealth. “The Chinese have what I call ‘profit-sharing corruption’: the Communist Party slips a straw into the milkshake so “they can have an interest in having the milkshake grow larger.”

The method of differentiating corruption by means of its characteristics permits Ang to separate between the amount and the quality of the corruption and, on observing it over the course of time, this leads her to arrive at the conclusion that the evolution of capitalism frequently has necessitated not only the eradication of corruption, but also its transition from “mafioso-like” forms and theft into sophisticated exchanges of power and profit-sharing. In this, notes the author, China is not different from the way the United States was at the beginning of the XIX century and its manner of evolving distinguishes it from innumerable nations that have been bogged down in primitive forms of corruption that, far from expediting economic development, obstruct it. I don’t know why, but Mexico seems much like this to me.