Author Archives: Matthew Stephenson

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About Matthew Stephenson

Professor of Law, Harvard Law School

New Working Paper on Anticorruption Reform in U.S. History

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Endemic public corruption in developing and transition countries often seems intractable. Yet most countries that are currently perceived as having relatively high levels of public integrity–places like Sweden, Denmark, the United Kingdom, and the United States–were, at an earlier point in their history, afflicted with pervasive corruption similar to what one finds throughout the developing world today. Considering the history these countries may therefore make a valuable contribution to modern debates about anticorruption reform—not so much by providing simple lessons about what policies to adopt, but by offering a broader sense of how the complex process of anticorruption reform unfolds over time, and by calling into question certain widely-held beliefs about this process.

A couple years back, after attending a fascinating presentation by Mariano-Florentino Cuellar (a Justice of the California Supreme Court who somehow manages to continue to hold down his former day job as a professor at Stanford Law School), I became particularly interested in the history of my own country, the United States, in the late nineteenth and early twentieth century. The challenges facing anticorruption reformers in the United States during this period bear a striking resemblance to the challenges facing reformers in modern-day democracies in the developing world. Indeed, the United States is a particularly interesting case study because, in contrast to most of the other Western democracies that are currently perceived as having low corruption, the United States established political democracy well before it embarked on significant “good government” reforms.

Justice Cuellar graciously agreed to collaborate with me, and we finally have a draft paper entitled “Taming Systemic Corruption: The American Experience and its Implications for Contemporary Debates.” The draft now available on SSRN here, and is also available as part of the University of Gothenburg Quality of Government (QoG) Institute’s working paper series. Our article, which focuses principally on the period between 1865 and 1941, does not purport to reach firm conclusions about the reasons that the U.S. struggle against systemic corruption ultimately succeeded—let alone to draw facile “lessons” about “what works.” But we do find that the U.S. experience calls into question a number of commonly-held views about the struggle against corruption in modern developing countries: Continue reading →

Tracking Corruption and Conflicts of Interest in the Trump Administration–September 2020 Update

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Back in May 2017, this blog started the project of tracking and cataloguing credible allegations that President Trump, and his family members and close associates, have been corruptly, and possibly illegally, leveraging the power of the presidency to enrich themselves. The newest update is now available here.

As previously noted, while we try to include only those allegations that appear credible, many of the allegations that we discuss are speculative and/or contested. We also do not attempt a full analysis of the laws and regulations that may or may not have been broken if the allegations are true. (For an overview of some of the relevant federal laws and regulations that might apply to some of the alleged problematic conduct, see here.)

Lebanon Disaster Update: An Excellent and Disturbing OCCRP Report Sheds New Light on the Backstory of the Deadly Explosion

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A couple of weeks ago, I did a short post in reaction to the deadly warehouse explosion in Beirut, which killed at least 182 people, wounded thousands, and left hundreds of thousands homeless. My post wasn’t really about the Lebanon blast per se—especially because the causes of the explosion, and the role that corruption may have played, were unclear—but rather discussed more generally the direct and indirect ways that widespread corruption can increase the risk of deadly accidents. But I continue to wonder whether, with respect to the Beirut tragedy, it will turn out that corruption (rather than “mere” incompetence) will have been a contributing cause.

We still don’t have all the answers—particularly with respect to the decision-making process within Lebanon itself—but thanks to excellent investigative reporting by an international team of journalists with the Organized Crime and Corruption Reporting Project (OCCRP), we now have a great deal more information about the shadowy and highly suspicious backstory of the abandoned ship that brought the ammonium nitrate to Beirut in the first place. I don’t think I can do the report justice, but I highly recommend that everyone read it—it’s available here. And to give you a sense of what’s in it, I’ll just quote the main findings summarized at the beginning of the report: Continue reading →

“The Cyprus Papers”: Al Jazeera Report Sheds New Light on Golden Passport Programs

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Last year, we had a series of posts on so-called “golden visa” and “golden passport” programs—systems in which countries allow foreign nationals to obtain permanent residence (in the case of golden visa programs) or even citizenship (in the case of golden passport programs) in exchange for a sufficiently large investment in the country, or in some cases for a straight-up cash payment to the government. (See here, here, here, and here.) These programs raise three corruption-related concerns:

  • First, in the eyes of some critics, the programs are themselves a form of (legalized) corruption, enabling individuals to use money to purchase something (permanent residence or citizenship) that should not be for sale.
  • Second, even if we adopt a narrower understanding of corruption, golden visa and golden passport programs may make it easier for corrupt officials and their cronies (as well as other wealthy criminals) to find safe havens for themselves and their money.
  • Third, while several countries have rules designed to deal with the preceding problem, these rules can generate considerable corruption in the programs themselves, as individuals who are ineligible for golden visas or passports can bribe or otherwise corrupt those administering the system to skirt the rules.

Data on the extent of these or other problems, though, is a bit thin, in part because information on the operation of golden passport and golden visa programs—especially with regard to the individuals who take advantage of these programs—is generally not publicly available. But those interested in this topic—and concerned about the corruption risks or other problems associated with these programs—might be interested in a recent report from Al Jazeera, dubbed “The Cyprus Papers,” which analyzed leaked documents on the operation of Cyprus’s “golden passport” program between 2017 and 2019. (Golden passport programs in Cyprus and Malta have attracted particular concern because those two countries are EU members, thus making citizens of these countries EU citizens as well.)

Al Jazeera provides a user-friendly interactive webpage for exploring the results of its analysis of these leaked documents, and I recommend that those interested in this subject check it out. A few highlights: Continue reading →

Guest Post: Promoting Procurement Transparency During the COVID-19 Pandemic in Brazil

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Today’s guest post is from Guilherme France, the Research Coordinator at Transparency International Brazil (TI Brazil), together with TI Brazil researchers Maria Dominguez and Vinicius Reis.

While the new coronavirus has slashed through Brazil at alarming rates since March, an old problem has undermined the government’s response: corruption. A considerable portion of the government money spent to deal with the pandemic may have already been lost to corruption and waste. To give just a few examples: in Amazonas the state government bought inadequate medical ventilators from a wine store; In Santa Catarina, the government spent over US$5 million on 200 ventilators that were never delivered; and in Rio de Janeiro, fraud led to losses of more than 700 million reais in the hiring of a company to construct emergency hospitals, most of which were never delivered.

As many have pointed out, the corruption risk in procurement is heightened during an emergency, because traditional procurement rules are relaxed or circumvented to allow goods and services to be purchased in a timely fashion. In Brazil, the problem is compounded by a lack of centralization—with over 5,000 independent government entities (federal institutions, states, and municipalities) competing with each other and international buyers for the same equipment.

In this challenging context, efforts to increase the transparency of government procurement and to promote social accountability are essential. To promote greater integrity and transparency in COVID-19 emergency procurement, last May Transparency International Brazil (TI Brazil) and the Federal Court of Accounts jointly published a set of Transparency Recommendations in Public Procurement. These recommendations inspired a methodology for assessing how well government entities were implementing transparency mechanisms to make emergency procurement data available in their websites. (The assessment method examines four dimensions: (1) the presentation of detailed information on suppliers and contracts, (2) the publication of data in open formats that allow complex analysis, comparison, and reuse; (3) information on the government’s own legislation regarding emergency procurement and related matters; and (4) the quality and availability of channels for citizens to make Freedom of Information requests and report on irregularities related to COVID-19 procurement, as well as the existence of committees, with civil society organizations, to monitor emergency procurement.) Using this method, TI Brazil has created an index on Transparency Ranking on Efforts Against COVID-19, which ranks government entities on a 0-100 scale and also assigns a designation of Poor, Bad, Regular, Good or Great, depending on how well the entity performs on the four dimensions of transparency described above. The initial index included an assessment of 53 local governments (states and state capitals), and monthly evaluations have been undertaken since.

The results are impressive so far. Between the first and the third rounds, for instance, every local government analyzed improved its score, and in the most recent round, 33 governments (20 capitals and 13 states) earned a transparency grade of “Good” or “Great”. The average scores increased from 46 to 85 (capitals) and from 59 to 85 (states). Continue reading →

Anticorruption Bibliography–August 2020 Update

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

Corruption and Deadly Accidents

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After last week’s catastrophic explosion in Beirut—which killed over 150 people, injured thousands, and left hundreds of thousands homeless—Lebanese citizens are rightly demanding a full investigation of the incident and accountability for those responsible. The official reports so far have stated that the source of the blast was an abandoned Russian cargo ship carrying a large quantity of ammonium nitrate; it is not clear why that vessel and its dangerous cargo, which arrived at the port in 2013, were allowed to remain for so long despite repeated warnings about the dangers. Some commentators have expressed skepticism about the official account, and suggested that the blast was caused by illegal munitions being smuggled through Lebanon. We do not yet know, and may never know, the full story.

Much of the coverage of the incident has emphasized the widespread corruption of the Lebanese government, and many Lebanese protestors have emphasized this same theme. It is not yet clear whether corruption had much directly to do with this incident. The official account so far suggests negligence and mismanagement rather than intentional malfeasance. But the instinct to suspect corruption is entirely understandable, because there is ample evidence that corruption is often a significant contributing cause of many deadly accidents. Indeed, while much of the public discussion about the costs of corruption, particularly by donor agencies and international institutions, focuses on macroeconomic outcomes (such as per capita income, GDP growth rates, and economic inequality) or on other measures of human development (such as education, literacy, and health), corruption is also a significant contributing cause of avoidable accidental deaths. Continue reading →

Tracking Corruption and Conflicts of Interest in the Trump Administration–August 2020 Update

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Back in May 2017, this blog started the project of tracking and cataloguing credible allegations that President Trump, and his family members and close associates, have been corruptly, and possibly illegally, leveraging the power of the presidency to enrich themselves. The newest update is now available here. As has been true for the past couple of months, most of the newest items relate to the federal government’s response to the coronavirus pandemic, including further evidence that federal bailout money has flowed to businesses owned or closely connected to President Trump’s family and cronies, and White House pressure to include in the next coronavirus relief package an unrelated $1.75 billion for the renovation of the FBI headquarters building located across the street from Trump’s D.C. hotel. One item, though, actually concerns events that took place over two years ago, but were only disclosed this past month: Apparently the U.S. Ambassador to the United Kingdom, acting at President Trump’s request, tried (unsuccessfully) to use his influence to get the British Open held at Trump’s Scotland golf course.

As previously noted, while we try to include only those allegations that appear credible, many of the allegations that we discuss are speculative and/or contested. We also do not attempt a full analysis of the laws and regulations that may or may not have been broken if the allegations are true. (For an overview of some of the relevant federal laws and regulations that might apply to some of the alleged problematic conduct, see here.)

There’s No Panacea for Corruption. So We Can All Stop Pointing That Out.

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I’m taking another one of my periodic breaks from semi-serious commentary to make a mostly frivolous, slightly snarky point about the way we talk and write about corruption. Here’s my plea for today:

Every sensible person would presumably agree that there’s no panacea (that is, no single cure-all) for corruption. But our community appears to have developed—perhaps as a kind of reflexive, semi-defensive verbal tick—the tendency to declare that whatever anticorruption measure we happen to be talking about is “not a panacea” for corruption. Thus we are told repeatedly, for example, that:

  • Transparency is not a panacea for corruption (see here, here, here, and here);
  • Anticorruption agencies are not a panacea for corruption (see here, here, here, and here);
  • New technologies are not a panacea for corruption (see here, here, here, and here);
  • Democracy is not a panacea for corruption (see here, here, and here);
  • Privatization is not a panacea for corruption (see here and here).

Other things that the literature has declared “not a panacea” for corruption include higher public sector salaries, international courts, more women in the public sector, EU membership, codes of corporate ethics, unexplained wealth orders, and economic sanctions.

Since we all agree (or should agree) that there is no panacea for corruption, we probably don’t need to keep saying that any individual measure is not a panacea. Of course it isn’t. There isn’t one. Done.

While this post is mainly meant as a gentle admonition (with the finger pointed at myself as much as anyone else) to be more mindful about trotting out tired clichés and banal statements of the obvious, I do think there’s something intriguing about how many of us working in this field (again, very much including myself) so frequently feel the subconscious compulsion to add what would seem to be an unnecessary caveat when discussing this or that anticorruption measure. Why do we do this? Perhaps we recognize the all-too-frequent tendency of advocates to make exaggerated claims on behalf of their preferred reform, and we want to reassure our audience that we are more nuanced and sophisticated? (I imagine, for example, that those advocating for greater use of modern information technology don’t want to be mistaken for naïve techno-utopians.) Or perhaps we worry, perhaps with justification, about managing the expectations of our audience, lest the failure of a proposed reform to eradicate the corruption problem be treated as evidence that the reform didn’t help, leading to greater cynicism and frustration?

Then again, maybe there’s no subject-specific explanation. Maybe it’s just a bad habit. In any event, I propose that we retire the phrase. Please allow me to be so bold as to officially declare in this blog post, on behalf of the anticorruption community, that there is no panacea for corruption. So, going forward, we don’t need to say it anymore. Just throw in an unexplained hyperlink to this post as soon as you introduce the anticorruption measure you want to discuss, without feeling the need to insert the “not a panacea” qualification. You’re welcome.

New Podcast, Featuring Danielle Brian

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A new episode of KickBack: The Global Anticorruption Podcast is now available. In this week’s episode, I interview Danielle Brian, the Executive Director of the Project on Government Oversight (POGO), a U.S. civil society watchdog organization that focuses on investigating, exposing, and preventing government corruption, fraud, and waste, and more broadly lobbies for systemic reforms to improve accountability and integrity in the U.S. government.

The interview begins with a conversation about POGO’s history and current work, and discusses POGO’s somewhat “hybrid model,” which combines investigation work on specific cases with a broader policy reform agenda. Ms. Brian provides, as an encouraging example of how groups like POGO can have a positive impact, POGO’s work in promoting significant reform in the regulations governing payments to oil and gas companies. She describes the case study as a useful illustration of a successful advocacy campaign, but also emphasizes that one of the lessons from this and other cases is that genuine reform takes time and requires patience. We then turn to several other challenges that anticorruption advocacy groups like POGO face, including how to maintain a reputation for nonpartisanship and how to balance the interest in engaging with the government and publicly criticizing the government. Ms. Brian and I also touch on a number of more specific issues, including concerns about corruption in the allocation of coronavirus relief funds, questions about whether or how to frame lobbying or other influence activities as “corrupt,” and the so-called “revolving door” problem.

You can also find both this episode and an archive of prior episodes at the following locations:

KickBack is a collaborative effort between GAB and the ICRN. If you like it, please subscribe/follow, and tell all your friends! And if you have suggestions for voices you’d like to hear on the podcast, just send me a message and let me know.

One other note: KickBack will be going on holiday in August, but we’ll be back with a new episode on September 7.