Defeating Corruption

Fifty years ago, we lived in a world of discrimination. It still exists, cripplingly so in some places, but we can marvel at what has been achieved. Disability, gender, colour or sexual preference are no longer the barriers they once were, at least in much of what we call the Western world.

There are other reasons to celebrate. Child mortality has been almost defeated. Many killer diseases have been tamed. And progress is even being made against extreme poverty. In the face of screaming negative headlines, we should remember to celebrate these advances.

And yet. I was in discussion with an interesting guy who came to fix my fridge last week. We got on to the subject of racial quotas, and scholarships restricted to minorities. These can be argued both ways – it does seem warped when colleges in the USA devote such a lot of their resources to sports, hardly a core activity.

But then I asked: if you were to be born today, would you rather be black or white? A man or a woman? American or Somali?

There is no doubt of the answers. For all the complaining we do about the complexities of life in the West and the simple, spiritual lives of others, I am not sure many of us would accept the offer of a swap at birth, for ourselves or our kids. While this is the case, I think we should happily swallow our doubts about a few quotas or scholarships?

One area I am not sure mankind has made enough progress is against corruption. I define this fairly widely, to include any abuse of a privilege, and to include institutional abuse as well as personal abuse.

Watching Downton Abbey gives a stylized picture of British society of a hundred years ago. Your status was inherited not earned, and the right status gave almost complete impunity, whether as a card shark or a philandering Prince of Wales. At the other end, a job was only retained at the whim of an employer. In my definition, this is a corrupt and sick society, its inefficiencies glaring. It might be noted that virtually all progressive moves away from this have been opposed by vested interests, usually of the right.

But how far have we come? When I looked at the various manifestations of corruption, I reached an unflattering conclusion. There are many examples.

When I was younger, I paid direct bribes, usually when travelling or to police. This has become more rare, and a recent study showed considerable progress in Africa. Yet it is still possible to demand a tip in NYC – you could argue this as equally corrupt.

As sports have become more professional and better paid, corruption has got a lot worse. I cannot watch cycling or athletics now without suspicion, and cricket is heading the same way.

There used to be many easy jobs available for life where the work required did not match the rewards available. My first job was a relief postman. I was given a typical round, and completed it with ease in under an hour. But I was told not to show up at the depot in under two and a half hours, lest I damage the cozy relationships there, all built on pretence. This ripped off the taxpayer. Does it still? My guess is that while the number of such jobs has gradually diminished, there are still many that exist. Unions have much to answer for here.

Cartels used to be everywhere, and accepted. When I joined Shell, it had just de-merged in the UK from BP, yet it was clear that personal relationships persisted and the market was carved up. I saw many examples through my career, places where if a call came through it was most often from a supposed competitor. The EU and the US have made positive strides on this one at least. But I have also seen companies recently where it appeared that the corruption was of breathtaking proportions, so there is a long way to go.

Finance has become more greedy and cynical. Probably the Madoffs existed fifty years ago – Ponzi goes back further – but now the stakes are higher and behavior seems no better. Exactly how do you think these people earn their bonuses?

A whole new category is lobbyists. Before, this took the form of the Earl of Grantham having a quiet word or the local freemasons making a case. Now, lobbyists are everywhere and have a massive impact, usually to the direct detriment of the taxpayer and the powerless. The US seems particularly badly served in this regard. Read Lexington in last weeks economist about a Florida by-election and weep.

Reading the Economist each week, it appears that many countries have governments composed of corrupt criminals, with shady figures in the background looting at ease. Fifty years ago we had never heard the word Oligarch. The prescriptions the West imposed on countries exiting communism after 1989 have a lot to answer for.

Furthermore, corruption of opportunity continues almost to the same degree as before. The best way to get to medical school is if Dad is a Doctor. Amazingly, children of alumni have advantages at getting into US colleges. The worst schools are still in the most deprived areas. While a recent study showed that social mobility in the US had not deteriorated in the last thirty years, it had not got any better either. To buy a house in London nowadays is virtually impossible if Mum and Dad don’t stump up most of the ante. The freemasons still exist do their dirty work, as do lots of religious organisations. Should it really help someone to get a job if a parent gets a priest to lobby with a parishioner boss? We all do it, but we have colluded in creating a playing field where privilege counts, and for me that is corruption.

The purpose of this litany is to reflect on how little progress we have made in this area compared with others. Looking at it topic by topic certainly gave me a jolt.

It is not hard to see why this has persisted. Vested interests want it to! That includes any of us who want to give our kids the benefits of our wealth or influence. Inheritance tax is a particular bugbear of mine. George Osborne gained popularity by promising to raise the threshold in the UK before tax became payable, a threshold that in the US is an incredible (to me) five million dollars. We support these policies, yet they are the epitome of a society of unequal opportunity.

To see the plus side, look at how much easier it is nowadays to follow good practice and to benefit as a consumer. Whether booking a hotel or selecting a choir director, the internet offers fantastic information, and, in my experience, open processes yield far stronger results.

The least corrupt place I lived was Sweden, and I think I know why. Partly it was a collective mindset, backed up by accepted redistributive taxation. But a key was also IT. Even then, everyone had a personal ID number, linking together health tax and police systems. It was so easy for everyone to know your business that being corrupt was much harder. Looking back, I take a more cynical view than I used to about the people who lobbied to block the ID card in Britain. Think about it: would entrenched privilege really want something like that?

So what are the solutions? Strong institutions must play a part – it was madness to introduce capitalism to Eastern Europe when there was no solid rule of law. I think Sweden also proves that IT has a role to play. It is a shame that the NSA and others have given mass data collection such a bad name, for actually this could be used for the common good.

And as usual, we must look at ourselves. Rather than complaining about quotas and scholarships for minorities, perhaps we should campaign to challenge the advantages still enjoyed by majorities, whether in cushy public sector jobs or professions, or subsidies for mortgages or in a host of other areas. That is more painful, for that means us.

But I personally am ashamed that, a hundred years after Downton Abbey, the answers to the questions about gender and inherited wealth and colour are still so emphatic. Let us use the next fifty years better than we used the last hundred.