The recent focus on the unchecked corruption in the Sochi Olympics made me reflect on what Russia can teach us about the costs and benefits of politically-motivated corruption prosecution, discussed in Matthew’s February 18 post. Businesspeople with close ties to Putin won and abused lucrative Olympic contracts with no repercussions from the state. Ironically, opposition blogger Alexei Navalny, who publicly exposed the rampant corruption in Olympic construction projects, was the target of a fabricated corruption prosecution in July of last year, and placed under house arrest (allegedly for violating the terms of his earlier suspended sentence) just last week–perhaps not coincidentally, right after the conclusion of the Sochi Olympics.
Navalny’s prosecution is just one example of the fraught landscape of corruption prosecution in Russia. In a 2008 paper entitled “Law as Politics: The Russian Procuracy and its Investigative Committee,” Ethan Burger and Mary Holland provide excellent background on the politicization of the Russian Procuracy, as well as the vivid examples of the Procuracy’s politically motivated activities described in this post. The Russian experience demonstrates that the costs of targeted corruption prosecutions may be higher and the benefits much more elusive than Matthew suggests.
Matthew identifies deterrence as a potential benefit of politically motivated corruption prosecutions: “politicians may be deterred from engaging in corrupt activities if they fear exposure by a political rival.” However, such exposure may not deter corruption among Russian politicians for two reasons.
First, when politicians must engage in corruption in order to participate in the political system at all, targeted corruption prosecutions will deter dissent from the ruling regime, not corrupt practices. The Procuracy’s selective prosecution of regional and local officials illustrates this point. Corruption is a prerequisite to regional officeholding. In wealthy regions, prospective governors must make illicit payments to the national government in order to secure a presidential appointment to the governorship. Many candidates solicit funds from corporate “sponsors” for this purpose. In the late 2000s, the Procuracy prosecuted several uncooperative regional governors on corruption charges. Similar prosecutions occurred at the local level. The mayors of Vladivostok and Volgograd were targeted for prosecution, while Moscow Mayor Yuri Luzhkov was left untouched (until his dismissal by Medvedev in 2010). What sort of incentives did this targeted prosecution campaign create? Will prospective politicians choose to opt out of the political system altogether by abstaining from corrupt practices, or, as is more likely the case, will they abstain from disobeying the center once in power?
Second, the Procuracy often prosecutes politicians and businesspeople on vague, corruption-like charges by reclassifying previously sanctioned activity as illegal. Burger and Holland describe the “arbitrary criminaliz[ation]” of conventional interactions between businesses and the government. For example, the Procuracy rebranded a sanctioned private-public deal as a “criminal scheme to defraud the state of due money.” This sort of ex post criminalization is likely made possible by the shockingly vague anticorruption federal statutes, which give wide latitude to prosecutors. When the parameters of criminal activity are fluid, two problems arise. First, the distinction set up by Matthew between convictions of innocent parties and convictions of truly guilty defendants breaks down somewhat. Second, individuals cannot know ex ante what behavior will be classified as corruption and what behavior will not. Unclear expectations about punishment weaken deterrence in any context.
What about the costs of targeted corruption prosecution? I think the most important lesson to draw from the Olympics and the atmosphere of impunity among the Russian elite generally is that the costs of selective prosecution cannot be considered in isolation from the costs of its corollary: the selective failure to prosecute. For every corruption witch-hunt, there may be egregious and crippling corrupt acts that go unprosecuted. Burger and Holland detail stunningly involved efforts of the Procuracy to avoid the investigation and prosecution of those with close connections to the regime. The devastating consequences of state-sanctioned corruption cannot be ignored when engaging in a cost-benefit analysis of politically-motivated corruption prosecutions.