Anticorruption Strategies for Small Population Countries

As I discussed in a prior post, countries with very small populations face distinct challenges when it comes to detecting and fighting corruption. In places where everyone knows everyone, personal ties between decision-makers and stakeholders are practically unavoidable. This not only makes it more difficult to avoid conflicts of interest, but also fosters a culture of informality that may inhibit efforts to impose stricter procedures and requirements for public decision-making. Furthermore, in small, close-knit communities it is harder to ensure anonymity of whistleblowers, and to detect corruption that takes the form of inappropriate long-term reciprocity rather than explicit quid pro quo exchanges.

The distinct challenges posed by corruption in small populations may call for distinct solutions. While there may not be any single solution to these challenges, there are a few approaches that may help:

  • Calling corruption by its name: When a person in a position of public trust prioritizes particular familial or social loyalties over those owed to the public, she is engaged in a form of corruption—abusing her entrusted power to benefit her friends and family. But such corruption may be perceived as benign or even salutary when it takes place in a community characterized by a high degree of close familial and social ties. The fact that these corrupt relationships often do not involve exchange of money may further help to camouflage them as a social interactions rather than as transactions involving the abuse of public trust. Unless corruption is identified and perceived as such, no anticorruption effort is going to succeed. Therefore, there needs to be constant and systematic education within the community to raise awareness about the causes and manifestations of kinship corruption, as well as the harms caused by it, in order to de-normalize this form of corruption (see here, here and here).
  • Leveraging the power of public opinion: In tight-knit communities, informal social sanctions (social exclusion, ostracism, and stigmatization) may be much more powerful in these communities and can be a meaningful constraint on corruption (see here). This is, of course, a double-edged sword: As noted above, unless kinship corruption is recognized as such, those involved are unlikely to be shamed by their peers and may actually be socially punished if they decline to do favors for friends and family. Similarly, social pressure can be used to reinforce clientelism and nepotism (see here and here). But anticorruption reformers can and should try to find ways to leverage the power of shaming, and other social sanctions, to promote integrity.
  • Depersonalize decision-making: As noted above, in small communities, it is harder to enforce the sorts of strict conflict of interest rules that are feasible in larger communities. Furthermore, even where there is no “formal” conflict of interest, in small countries there is an increased likelihood that public decisionmakers will have personal relationships or connections with some of the people who would be affected by their decisions. In a hiring process, for example, those responsible for the hiring will very often have some connection with at least one of the applicants. Therefore, small-population countries should place an even greater emphasis on removing the personal element as much as possible. For example, anonymizing administrative procedures and implementing “blind” decision making not only makes nepotism and clientelism harder, but also reduces the risk of unconscious bias (see here and here).
  • International assistance: Another, potentially more controversial way for small countries to overcome the inherent difficulties in aggressively applying anticorruption laws within a close-knit community is to seek the assistance of the international community, for example by relying more heavily on international assistance to fight corruption. This is not only because outsiders may be less likely to have conflicts of interest. It is also because small population countries may simply have fewer talented people to devote to any single matter, including anticorruption (see here and here). International assistance, for example in the form of manpower with suitable expertise, may help to alleviate such issues.

As we are often reminded, there is no one-size-fits-all approach to anticorruption, and it is also true that there is no one anticorruption recipe for all small countries. Nevertheless, when designing anticorruption strategies for very small jurisdictions, it is useful to recognize some of the common challenges that such jurisdictions face, and to design anticorruption strategies that leverage some of the advantages of smallness while ameliorating some of its drawbacks.

Guest Post: Shifting Anticorruption Messaging from “Crime and Punishment” to “Guardrails for Good Government”

Today’s guest post is from Joe Grady, a co-founder of the Topos Partnership, a firm that specializes in public opinion research:

Public backing is critical to the success of anticorruption reform efforts. Yet communications intended to mobilize the public against corruption often backfire, making audiences less engaged and less confident the problem can be solved. To better understand this problem, the Open Society Foundations recently sponsored an international research effort led by the Topos Partnership to better understand how residents of three countries—the United States, North Macedonia, and Brazil—think about corruption in the public sphere, and how best to engage them in efforts to combat the problem. In each country, ethnographers spoke at length with roughly 150 people, followed by internet surveys testing different kinds of messages.

Not surprisingly, findings across the countries are distinct in various interesting ways. Macedonians, for example, often have a sense that their country lags behind other European countries, and they may also look back nostalgically at the Yugoslav era when things seemed to run more predictably. Brazilians see themselves as being culturally averse to rigid rules and procedures, including those that keep government “honest.” The U.S. public has a strong sense that government is supposed to be by and for the people. But despite these important differences, there are also important similarities across the three countries. Continue reading

Walking Free on Stolen Time, Najib Sees 1MDB Appeal Prospects Improve

When $681 million ended up in the personal bank account of then-Prime Minister of Malaysia Najib Razak, he thought it was a political donation from the King of Saudi Arabia. Sure, it’s strange that the King transferred such a large sum directly into Najib’s personal account as opposed to that of a government institution, and yes, such a personal donation to a foreign leader was an unprecedented move by the Saudi royals. But the late King had assured Najib that some sort of donation was coming his way, so why not over half a billion dollars? Perhaps Najib would’ve examined the transfer a little more closely if he wasn’t so accustomed to lavish gifts. Indeed, when the financial anomaly came to light and the police raided his properties, that’s what filled the nearly 300 boxes the police discovered: gifts! The 567 luxury handbags (including a $219,000 Birkin bag) stuffed with $30 million in cash, the 423 designer watches, the 234 pairs of sunglasses, 14 tiaras, and 12,000 pieces of jewelry—all gifts from friends and admirers. So of course Najib was shocked—shocked!—to discover that the $681 million that appeared in his bank account actually came not from the Saudi royals, but from 1MDB, a government-run strategic development company where he served as chairman. Poor Najib was simply the unwitting victim of a network of 1MDB officers who embezzled $4.5 billion from the fund, kept comparatively meager amounts for themselves, and then deviously planted the lion’s share of the loot in Najib’s accounts to implicate him as the mastermind behind their corruption.

Unconvinced? You’re in good company. Neither was the trial court that convicted Najib last July on seven criminal charges including money laundering, criminal breach of trust, and abuse of power for his role in the 1MDB scandal, the world’s largest kleptocracy scheme. Najib faces 12 years in prison and a $49 million fine if this verdict is upheld. (And this is only the first case—he faces another 35 criminal charges in related cases.)

But alas, there is a very real possibility that Najib’s conviction will be set aside on appeal. Not because his account of how the $681 million ended up in his account has gotten any more plausible (despite Najib’s new legal strategy), but because Najib and his party—which is now back in power—are drawing out the process as best they can in order to give themselves sufficient time to subvert the judicial process and manipulate public opinion.

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The Alleged Police Misconduct in the Netanyahu Corruption Investigations Illustrates Why Police Should Err on the Side of Caution

In corruption investigations, witness testimony is often crucial. After all, corrupt acts usually take place in secret, and the parties involved rarely leave behind records documenting their illegal deeds. It should therefore come as no surprise that an essential part of the corruption investigations into Israeli Prime Minister Benjamin Netanyahu has been the law enforcement authorities’ attempt to obtain incriminating testimony from those with (allegedly) first-hand knowledge of the corrupt actions, and to turn some of them into “state’s witnesses” (defined by Israeli law as “an accomplice who testifies on behalf of the prosecution after a benefit has been given or promised [to] him [or her],” usually in the form of immunity from prosecution or other alleviations). These efforts have met with some success (see here, here, and here).

However, according to Israeli news outlets whose reporters have gotten access to leaked police transcripts, the Netanyahu investigators may have gone too far. These transcripts suggest that police investigators tried to convince two key witnesses, who themselves were suspected of involvement in the corrupt schemes, to replace their defense attorneys – apparently because these defense attorneys had been advising their clients not to sign a state’s witness agreement (see here and here). (In Israel, defense attorneys are not present in the interrogation room, as suspects do not have a right to have their lawyers present during an interrogation.) One of the witnesses did indeed hire a new attorney and signed a state’s witness agreement, though we can’t be sure if the police investigators’ “suggestion” that he do so was the reason. If the police did pressure these suspects to fire their lawyers, it would be illegal, as Israel’s Supreme Court has held that police may not attempt to interfere with a suspect’s relationship with, or trust in, her attorney. In addition, the transcripts suggest that the police may have illegitimately pressured one of the witnesses during his arrest, threatening that lack of cooperation might result in negative consequences to him and others, and employing highly controversial interrogation tactics (see herehere, and here). At this stage, we do not yet know for sure what actually transpired, and Israel’s Attorney General has ordered that the claims of police misconduct be investigated.

The leaked transcripts and the allegations of severe police misconduct have generally been greeted with wide public criticism that transcended political boundaries. Prime Minister Netanyahu’s supporters and party members, including the Minister of Justice, have (unsurprisingly) been most critical, arguing that the police’s actions offer more proof of Netanyahu’s “persecution” by law enforcement authorities, a claim that has been promoted by Netanyahu almost since the beginning of his investigations (see here and here). Putting that harsh (and unproven) last claim to one side, it’s definitely the case that police investigators have been zealous in their pursuit of Netanyahu and his alleged co-conspirators, and the police may have been, at the very least, pushing the boundaries of what the law allows. This, in my view, is a mistake. To be clear, I do not mean to argue simply that the police should not break the law. That is true, but not many people would claim that the police should disregard the law when fighting corruption. But there’s another view out there, espoused by a considerable number of “tough on corruption” proponents, that law enforcement authorities should “push the envelope” as much as possible, doing everything they can even if their actions are sometimes to be deemed illegal by courts. According to this view, there is no place for softness in the interrogation room, and the police sometimes need to be willing to operate right at the edge of what the law will permit. It is this attitude that I want to argue against.

And this is not only because we should care about the rights of suspects and the fairness of criminal investigations. Indeed, “tough on corruption” proponents ought to worry the most about forms of police aggressiveness that come close to, and may cross, the line into police misconduct. In the Netanyahu case, to stick with that example, the police investigators’ alleged overreach may also prove to be counterproductive to anticorruption efforts, not only putting the investigation in jeopardy but producing long-term adverse consequences for effective anticorruption law enforcement. From the perspective of anticorruption policy, there are a few practical reasons why the police, while investigating allegations of corruption, should fully respect the rights of witnesses, and err on the side of caution: Continue reading

Guest Post: How a Social Movement Changed Spanish Attitudes Toward Corruption

Today’s guest post is from Elisa Elliott Alonso, who works at the OECD Water Governance Program:

The graph below chronicles the percentage of Spanish Citizens who named the economy (grey line) and fraud/corruption (blue line) as one of the three most important problems facing the country, during the period leading up to and following the economic downturn of 2008. Unsurprisingly, after the Spanish economy crashed, some 50% of the citizens of Spain noted that the economy was one of the most important issue affecting them, and this concern remained predominant for the next three years, though it started to decline a bit after 2011. As for corruption and fraud, prior to the crash concerns about these issues hardly registered, except for a brief spike in 1993, an uptick came in the immediate aftermath of a slew of highly publicized corruption scandals, and dissipated quickly) Even after the 2008 crash, concern about corruption rose only slightly increased from 2008 to 2012. That big change came in 2013, when the news broke that important members of the conservative PP party were allegedly involved in the Gürtel case, one of the most serious recent corruption scandals to rock Spain. More interesting is the fact that Corruption has remained a top concern of Spanish citizens ever since. There’s been a bit of tapering off since concern over corruption reached its peak in late 2014, but more than 20% of Spanish citizens still list corruption as one of the country’s most serious problems, roughly the same number of name the economy.

Why is this? Or, to put the question more generally, what kind of changes need to take place within a collective society’s ethos in order to bring about engaged citizen awareness and opposition to corrupt activities? Continue reading

The Limited Effect of Corruption Allegations on Voters: A Brief Analysis of Prime Minister Netanyahu’s Reelection

Last fall, Professor Stephenson alluded to the confusion that many in the anticorruption community feel regarding “voters in many democracies [who] seem to support candidates that are known or reputed to be corrupt.” This confusion was shared by many of my (non-Israeli) colleagues over the last few weeks, upon learning that Benjamin Netanyahu won the April 2019 elections and will serve as Israel’s Prime Minister for a fourth consecutive term (and fifth term overall), despite being suspected of various corruption offenses, including bribery and breach of trust (see here, here, here, and here). (Saying that Netanyahu won the elections is slightly inaccurate in a technical sense, since in Israel voters do not vote directly for the candidate they wish to serve as Prime Minister, but rather for the party they wish to represent them in the parliament (the Knesset). Nonetheless, 26.46% of the voters supported Netanyahu’s Likud party, making it one of the two largest parties in the Knesset; many other voters supported various other right-wing parties that were sure to join Likud to form a government.) Does the fact that so many Israelis cast their ballot in favor of Netanyahu’s party, or other parties sure to back Netanyahu for Prime Minister, mean that Israeli voters simply do not care about corruption?

The short answer is no. The longer answer is that there are three main reasons why voters may have chosen to support Likud despite disapproving of corruption:

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Reasons for Optimism About Latin America’s Wave of Anticorruption Prosecutions: A Response to Professor Balan

What are we to make of the ongoing wave of corruption prosecutions sweeping Latin America in the wake of the Odebrecht scandal? Many are optimistic that these prosecutions, several of which have implicated very senior political figures, including current and former presidents, signal a turning point for the region. But in a guest post last September, Professor Manuel Balan suggested that this optimism may be misplaced, for three reasons. First, he argued that the enforcement patterns suggest that anticorruption prosecutions are becoming a weaponized—that these prosecutions are being used as a political tool used to bring down opponents, and consequently they lack credibility with much of the public. Second, Professor Balan questioned whether these prosecutions would ultimately be successful in holding powerful, popular wrongdoers accountable, and he argued that these prosecutions will just take down leaders whose positions have weakened for other reasons (such as Dilma Rousseff in Brazil). Third, Professor Balan worried that these prosecutions show that judicial power is increasing at the expense of citizens’ power—that they represent an erosion of “vertical accountability.”

I remain one of the optimists. Indeed, I think that Professor Balan is far too pessimistic about the role that the current anticorruption prosecutions in Latin American can play—and to some extent have already played—in addressing the region’s longstanding corruption and impunity problems. Yet his three objections are worth taking seriously and deserve a direct response. Here’s why I don’t find any of them sufficiently persuasive to share his pessimism:

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Guest Post: The Taxi Driver Paradox–or How Descriptive Social Norms Shape Corrupt Behavior

Nils Köbis, a post-doctoral researcher at the Center for Experimental Economics and Political Decision-Making (CREED), University of Amsterdam, contributes today’s guest post:

Whenever I am traveling and take a taxi, I try to strike up a conversation with the driver. The beauty of this situation is that both sides can be really candid. The length is typically short, and chances are you will never meet again. The chat usually kicks off with some small talk about sports, weather, and food. Once warmed up, I have often asked: “What do you think is the biggest problem in your society?” So far, the most common answer has been corruption. And my taxi-driver-based anecdotal evidence is consistent with large  international surveys. Notwithstanding the old canard that people who live in corrupt societies generally tolerate corruption as normal and natural, ample empirical evidence (and my taxi drivers) suggests that this is not true: People widely despise corruption, especially in countries riddled with it. Yet on several occasions the very same taxi driver who has been ranting to me about corruption has stopped by a traffic police officer—and willingly paid a bribe to avoid a ticket.

What explains this apparent paradox? The most frequent explanation for why a person outraged by corruption would nevertheless pay a bribe is that “everybody does it”—as the Nigerian novelist Chimamanda Adichie nicely puts it, “If we do something over and over again it becomes normal. If we see the same thing over and over again it becomes normal.” This notion of normality plays an important role in explaining why corruption is sometimes the exception and sometimes the rule. Scholars who research social norms differentiate between injunctive norms, which concern whether a given behavior is acceptable, and descriptive norms, which indicate whether the same behavior is common. This distinction might help to explain the taxi-driver-paradox: People might often bribe because everybody else is doing it, even though they think it’s wrong. Continue reading

Western Anticorruption Policy in Ukraine: Success or Failure?

A few weeks back, I came across an interesting point-counterpoint on the impact of Western-backed efforts to promote anticorruption reform in Ukraine. On one side we have an online piece in Foreign Affairs by Adrian Karatnycky (the Managing Partner of a consulting firm that “works with investors and corporations seeking entry into the complex but lucrative emerging markets of Ukraine and Eastern Europe”) and Alexander Motyl (Professor of Political Science at Rutgers University) entitled, “How Western Anticorruption Policy Is Failing Ukraine.” And then on the other side we have a response piece on the Atlantic Council blog from Daria Kaleniuk (Executive Director of the Anti-Corruption Action Centre in Kyiv) entitled “Actually, the West’s Anticorruption Policy Is Spot on.” I’m no Ukraine expert, and so I’m reluctant to take a strong position on which side has the better of the argument, but I found the debate interesting not only for its implications for Ukraine, but also because it raises a couple of more general issues that come up in many other contexts, issues that anticorruption advocates should pay attention to even if they have no particular interest in Ukraine. Those issues are, first, a question of messaging—what I’ll call the glass-half-full/glass-half-empty question—and, second, the relative importance of holding individual wrongdoers personally (and criminally) accountable for corrupt conduct.

Let me first try to give a flavor of the debate, and then say a bit about each of those two issues. Continue reading

Is Trump Administration Corruption a Winning Issue for Democrats this November?

The corruption of the Trump administration is bad news for the United States—will it also prove to be bad news (politically) for Trump’s Republican Party allies? A number of astute political commentators have recently argued that the answer is yes. Most notably, Jonathan Chait published an article last week making the case that “corruption … is Trump’s greatest political liability,” and that even though Trump himself is not on the ballot in the 2018 midterm elections, it would be wise politics for the Democrats to focus on the corruption of the Trump administration in their quest to retake one or both chambers of Congress.

Chait notes, as an initial matter, that despite Trump’s historic unpopularity, Democrats face two interrelated challenges: First, there’s just so much negative news about Trump—from the Russia investigation to his racism and misogyny to the lurid revelations regarding his crude attempts to cover up an affair with an adult film actress—that it’s hard to focus on any one thing. Second, and more importantly, the majority of Trump’s supporters already knew back when they voted for him that he was a crass, crude, adulterous bully and bigot–which means that pointing out his infidelity, his bullying, and his bigotry now isn’t likely to have much impact. (The Russia investigation is another matter, but Chait suggest that it’s too abstract and complex for most voters.) Corruption, according to Chait, is the one story that could move the needle, even with Trump supporters. Chait’s reasoning (presented in a somewhat different order from his original article) runs as follows: Continue reading