Controlling Corruption in Afghan Aid as the U.S. Withdraws

Foreign aid has flooded into Afghanistan over the past decade and a half, including over $104 billion in US aid dollars alone; indeed foreign aid currently comprises 60% of Afghanistan’s budget expenditures. But despite—or perhaps because of—these immense expenditures, corruption still plagues the Afghan government and economy (Afghanistan ranks 175/177 on Transparency International’s Corruption Perception Index)–and this greatly concerns the Afghan people. Since 2008, the American effort to address corruption in Afghanistan has been overseen by the Special Inspector General for Afghanistan Reconstruction (SIGAR). SIGAR, currently headed by attorney John Sopko, conducts audits and investigations, and issues recommendations and reports to reduce fraud, waste, and inefficiency. SIGAR’s unique approach—centralized, independent oversight over all agencies involved in Afghan reconstruction—has yielded tangible benefits, including saving almost half a billion dollars through a single audit. Reform efforts by the United States and the international community have improved Afghan legal structures, including by crafting comprehensive anticorruption laws and strategies, though serious problems remain.

Yet maintaining accountability and oversight over foreign aid will be even more challenging as U.S. troops leave. In SIGAR’s most recent quarterly report, Sopko points out that “[l]arge areas of the country . . . will soon be off limits to U.S. personnel due to base closures and troop withdrawals.” Nonetheless, the U.S. will continue providing external financial assistance as Afghanistan even as America’s footprint shrinks, and the United States will continue to foot the bill for much of Afghanistan’s public sector even as the US withdraws all but 9,800 troops by December 2014. What can American policymakers to do address the problem of corruption in development aid to Afghanistan during and after the withdrawal?

At first blush, perhaps not much. The US has struggled to stem misallocation of American funds previously, and its levers will weaken as its presence diminishes. Nevertheless, the US will retain significant influence in the near future, and there are a number of concrete steps the US can and should take to limit the extent of corruption in US development aid to Afghanistan, and to support anticorruption efforts in Afghanistan more generally: Continue reading

“The Whole World Can Commit Corrupt Acts” : Petrobras and the Brazilian Election

“There are corrupt people everywhere,” said Brazilian President Dilma Rousseff. “In my opinion, the whole world can commit corrupt acts.” Brazil’s presidential election is neck and neck, the closest in a generation. As both candidates accuse each other of corruption, two questions come to mind: First, is corruption influencing the outcome of this race? Second, should it? Continue reading

Anticorruption Bibliography – October 2014 Update

An updated version of my anticorruption bibliography is available from my faculty webpage.  A direct link to the pdf is here.  As always, I welcome suggestions for other sources that are not yet included, including any papers GAB readers have written.

U.S. Department of Justice/Civil Society — 1; Kleptocrats — 0

October 10, 2014, deserves mention in any future history of the anticorruption movement, for it was on this date that a ruling kleptocratic family (colloquially known as thugs in power) conceded the obvious: that the money to fund a kleptocratic lifestyle — in this case a mansion in Malibu, a Ferrari 599 GTO, and Michael Jackson memorabilia – did not come from the family’s hard work on behalf of the citizens they rule.  Rather, it came the easy way: from the wholesale theft of the nation’s patrimony.

This startling, if obvious, concession came in the settlement of a civil suit filed by the U.S. Department of Justice, with the support and encouragement of civil society, against an unlikely group of defendants.  In the order listed in the complaint, they are: 1) One White Crystal Covered Bad Tour Glove and Other Michael Jackson Memorabilia, 2) One Gulfstream G-V Jet Airplane Displaying Tail Number VPCES, 3) Real Property Located on Sweetwater Mesa Road In Malibu California, 4) One 2007 Bentley Azure, 5) One 2008 Bugatti Veyron, 6) One 2008 Lamborghini Murcielago, 7) One 2008 Rolls Royce Drophead Coupe, 8) One 2009 Rolls Royce Drophead Coupe, 9) 2009 Rolls Royce Phantom Coupe, and 10) the Ferrari 599 GTO.

Although defendants stood mute before the court, their owner, Teodoro Nguema Obiang Mangue, Second Vice President of Equatorial Guinea and (surprise?) son of the country’s president, was anything but.  Through the mouths of expensive American legal talent he complained loudly and bitterly that the ten named defendants were innocent.  But in settling the case, he agreed in effect that three – the mansion, the Ferrari, and some of the Michael Jackson memorabilia, were indeed guilty.  Guilty? Of what? Continue reading

Is Corruption Partly Responsible for the Ebola Crisis?

There’s been an interesting mini-debate over at the FCPA Blog about whether, or to what extent, corruption is partly responsible for the severity of the Ebola crisis in West Africa. Richard Cassin, the publisher and editor of the FCPA Blog, argued that it is. He made this argument initially in a post from this past August entitled “Ebola tragedy is also a story of graft.” He offered as evidence the following observations: (1) the WHO and other observers estimate that a very high percentage–perhaps up to 25%–of global spending on public health is lost to corruption; (2) the very high Ebola fatality rates in West Africa have been attributed in part to the lack of adequate intensive care facilities to administer the treatments; and (3) the countries hardest hit by the Ebola outbreak–Guinea, Liberia, Sierra Leone, and Nigeria–are reputed to be highly corrupt, as indicated by their very poor scores on Transparency International’s Corruption Perceptions Index.

Many critics who commented on Cassin’s initial post complained that the evidence offered did not in fact support the strong claim in the title that corruption has contributed significantly to the Ebola outbreak. In particular, the critics pointed out that: (1) the fact that a great deal of public health spending generally is lost to corruption does not actually tell us whether corruption was a major factor in the particular case of the Ebola outbreak, and (2) the low ranking of the affected countries on the CPI likewise–even if we concede that the CPI is a decent measure of actual corruption–does not indicate that corruption caused (in any significant way) the Ebola outbreak to be as lethal as it has been; at most it shows a correlation that might be explained by any number of other factors.

Cassin responded with a second post last month in which he rebutted the critics. He acknowledged that while one can never establish with “scientific certainty” that corruption has a causal effect on the severity of the Ebola outbreak, there is powerful circumstantial evidence that corruption is a “gateway” to this and other public health crises (as well as other problems like terrorism and crime), because it siphons off public resources. Cassin cites to a couple of research papers that purport to show that corruption in general has adverse impacts on public health, in particular because it adversely affects access to clean water and sanitation.

While I’m generally sympathetic to Cassin’s larger point, I think that the criticisms are fair ones. Here’s my take. Continue reading

Announcement: The GAB Network Initiative — Connecting Students and Faculty

One of our objectives here at the Global Anticorruption Blog is to promote more dialogue and exchange, not only among anticorruption professionals, but among the university students who will be the leaders of the next generation of anticorruption researchers, activists, and reformers. To pursue that end, GAB is pleased to announce the launch of the GAB Network, a group of affiliated university student organizations and classes from around the world who are interested in engaging in online discussions and debates about the topics covered on this blog. In addition to providing a platform for these online discussions, GAB will feature occasional guest posts showcasing research conducted by GAB Network member groups.

You can read more about the network and see a list of current participants here. If you are a university student or faculty member interested in learning more about participation in the GAB Network, please contact us.

An (Un)Appealing Argument: Why Bob McDonnell Shouldn’t Get His Hopes Up

If former Virginia Governor Robert McDonnell is certain of anything, it’s that he never actually abused the powers of his office for the benefit of Jonnie Williams. Forget about the $170,000 or so in loans and gifts Williams extended to Virginia’s first family; “McDonnell’s last line of defense,” as Rick has noted, “[is] that the favors he did for Williams were not part of his official duties as governor.”  In other words, McDonnell believes that his influence peddling on behalf of Williams — in return for Williams’s financial “assistance” — did not amount to “the performance of an official act,” as required by federal bribery law.

Unfortunately for McDonnell, the judge overseeing his trial disagreed and refused to instruct the jury — as McDonnell had requested — that “merely arranging a meeting, attending an event, hosting a reception, or making a speech are not, standing alone, ‘official acts.’”  Instead, Judge Spencer adopted the prosecution’s understanding that federal bribery law encompasses quid pro quo arrangements involving the performance of either (1) a public official’s statutory duties or (2) those settled practices “‘that a public official customarily performs’ even if they are not prescribed in law.”  Not to be deterred, the former Governor thinks he has a strong case for challenging this instruction on appeal.  Here’s why he’s wrong.

Continue reading