The corrosive effect of corrupt anti-corruption campaigns

The Amazon rainforest has been burning for weeks. Yet, Brazil’s right-wing president, Jair Bolsonaro, mobilized the armed forces to help contain the fires only in the last few days—in the face of European leaders’ threat to suspend a major trade deal and the possibility of a far-reaching boycott of Brazilian products. And though the Bolsonaro government’s rollback and weak enforcement of laws protecting the Amazon are root causes of the crisis, encouraging ranchers to set fires to clear land for agriculture, there has been no mention of any policy change.

The crisis in the Amazon is a stark example of the damage that can be done when governments bow unequivocally to business interests. It also highlights an increasingly common phenomenon: the cynical manipulation of anti-corruption efforts to undermine democracy and advance an authoritarian political agenda.

Some conservative economists argue that corruption can be benign, or even beneficial, as it enables economic actors to bypass regulations, thereby enabling markets to function more effectively. While there may be instances of benign corruption, the truth is that corruption corrodes markets, protects incumbents from competitive challenges by impeding the entry of new actors, destroys the moral fabric of society, and stunts economic development. Indeed, as Transparency International’s Corruption Perceptions Index (CPI) shows, there is a strong inverse correlation between development and corruption.

According to the latest CPI data, the world’s least corrupt countries are Denmark and New Zealand. Both have achieved high standards of living. The world’s most corrupt countries, by contrast, are Somalia, South Sudan, and Syria—all poor and mired in conflict. Ranked from least to most corrupt, the US is 22nd on the 180-country list; among major developing and emerging economies, India is 78th, China is 87th, Brazil is 105th, and Nigeria is 144th.

The data also suggest that the common belief that corruption is hardwired in some societies does not stand up to scrutiny. Corruption levels can and do change, at times quite sharply. A couple of centuries ago, corruption was rampant in countries like the United Kingdom, which today ranks 11th on the CPI. And recent examples from Asia show improvement can occur quickly. Prior to self-government in 1959, Singapore was beset by corruption; since 1995 (when the CPI was introduced), it has consistently ranked among Asia’s least corrupt countries. This year, it reached third place (tied with Finland, Sweden, and Switzerland). Likewise, Japan is 18th, and Hong Kong has risen quickly to 14th place.

Addressing corruption is not always straightforward. The connection between corruption management and democratic compromise is complex and not commonly understood. This is the reason why many leaders who have come to power with a genuine interest in controlling corruption have ended up nurturing cronyism and damaging democracy instead.

That is what happened in Brazil last year, when former president Luiz Inácio Lula da Silva was jailed for corruption, not as an honest attempt to build a more transparent political system, but rather to exclude him from the presidential election, which opinion polls suggested he would win, thereby enabling Bolsonaro’s victory.

Some political leaders take an even more direct approach, launching a corruption “purge" that targets rivals or critics for prosecution. In countries that are rife with high-level corruption, this is easy to do: leaders can simply begin by taking aim at those who challenge their authority. What starts as an anti-corruption drive ends up as an instrument of cronyism and media control. And by creating a safe zone for loyalists, it often ends up exacerbating corruption.

The campaign pursued by Nigerian President Muhammadu Buhari since his election in 2015 is widely viewed as having targeted opponents and spared allies. The same risks exist in many other countries.

Corruption can implicate even those who would prefer to operate according to the law, especially in countries where it is endemic. I was personally caught up in such a situation in 1992, when leaving Moscow after a five-day conference. The immigration officer at the airport looked at my passport and said grimly, “Your visa was for four days. It expired yesterday." Then, without batting an eye, he asked for a $50 bribe. Looking back, I marvel at my courage. I bargained, and we settled on $5. But when he stamped my passport, the thought struck me that if someone was watching, I could be arrested for bribing an officer. I panicked, snatched my passport, and ran to my gate without paying the bribe. To this day, I don’t know whether my action was morally defensible. I struck a contract and reneged on it. It is rare to feel guilty for not paying a bribe, but I lived with that feeling for quite some time.

But the mere fact that I was put in that position shows just how easily corruption can proliferate, especially in a context where it is already an embedded part of everyday life. In such cases, corrupt systems are vulnerable not just to corruption itself, but also to politically motivated “anti-corruption" initiatives that entrench the power imbalances they are supposed to overcome and facilitate the rise of undemocratic regimes. The scale of the devastation such manipulation can wreak is evident in the Amazon today.

Kaushik Basu is professor of economics at Cornell University and Nonresident Senior Fellow at the Brookings Institution