Tullock paradox
Imagine someone sees that they would gain a billion from a particular political policy. The bribe to cause this to occur is hugely less, around 1% of the expected gain. The question is often framed as ‘Why is there so little money in politics?” wikipedia offers three explanations; (i) politicians are generally punished for taking large bribes and are relatively immune to consequences for hidden ones (ii) that environment causes any bidding to go downwards, not upwards and (iii) the lack of trust between parties and the inability to force compliance in either direction also pushes down the price. I wonder what form a ‘hidden bribe’ takes. Try reading this. Maybe a separate essay?
At the end of essay 259 is a footnote about the Tullock paradox, which I have put in a text box somewhere to the right. Just how much corruption is there, how might we identify it and is any of it actually good for us? Reflexively I’m thinking that it surely can’t be good for us, but perhaps the cost of its elimination is too high a price. Surely we would be better tasked with trying to make other objectives more attractive. As so often happens, I expect this will return or reduce to issues of greed.
Corruption comes in two sizes, grand and petty, and two classes, economic and political. the biggest (and best only if you’re in on the deal or writing about it) is at a high government level and sufficient to degrade government function, particularly in allowing various senses of leader to benefit at public expense. The minor versions of corruption refer to lower level but still public officials who use their access to goods or services or information to benefit themselves. Political corruption appears to occur throughout this spectrum, where the gain (real or perceived) lies in creating, magnifying or preserving power, status and wealth attached to the political position. See [2] for a variety of such activities with appropriate labels, that you might treat as definitions.
Corruption is something that occurs when the national institutions are weak, as described in essays 258 and 259. as [1] says: On the political front, corruption is a major obstacle to democracy and the rule of law. In a democratic system, offices and institutions lose their legitimacy when they’re misused for private advantage. This is harmful in established democracies, but even more so in newly emerging ones. It is extremely challenging to develop accountable political leadership in a corrupt climate.
Economically, corruption depletes national wealth. Corrupt politicians invest scarce public resources in projects that will line their pockets rather than benefit communities, and prioritise high-profile projects such as dams, power plants, pipelines and refineries over less spectacular but more urgent infrastructure projects such as schools, hospitals and roads. Corruption also hinders the development of fair market structures and distorts competition, which in turn deters investment.
Corruption corrodes the social fabric of society. It undermines people's trust in the political system, in its institutions and its leadership. A distrustful or apathetic public can then become yet another hurdle to challenging corruption.
This ties uncomfortably to Political Distrust and I wonder how we might ascertain the levels of corruption in Britain. We cannot say there is none, but we can ask what level of this is acceptable. While you leap to say “None”, I ask what we can do to reduce it. [1] says corruption can only be kept in check if representatives from government, business and civil society work together to develop standards and procedures they all support. In, they emphasise, a non-confrontational way, for that is the only way to keep everyone involved.
Britain is remarkably free of corruption, according to source [4] ¹ Source [5]’s several respondents suggest that what corruption there is in Britain is pretty sophisticated, which is used to explain the apparent high status on lists of corrupt places. You might enjoy reading [7], which explains how our financial institutions could be considered corrupt, leading to a label [5] repeats, that the UK is the world leader in money laundering. Since such a lot of money goes through our hands, it wouldn’t take much for that to be correct; what would be very British would be to agree with the claim and go do something about reducing it.
A point with which I agree is raised by several different respondents in [5], that people who are found to have been in some way (wholly or partially) responsible for a corrupt behaviour within a bank or similar body are very often rewarded with gross pay-outs, which the rest of us can only see as reward, or, if you prefer, compensation for being in some sense found out, perhaps only for being the one left without a chair when the music stopped. I point to the lack of prosecution or financial penalty to all the bankers working in 2008. I see that we the public paid for their errors, and that they seem to have been paid even more, for being wrong, for being corrupt, for being greedy. Mind, they might say they were doing so on our behalf….
I wonder at how we create and support the accusation that we have an elite class in Britain. The smart and expensive school followed by Oxbridge ought to produce clever, able people with a veneer relatively hard to come by from other routes to education. So perhaps the complaint is that so many of these people have similar backgrounds? Then let’s do something about that, and find ways to cause there to be similalrly clever, educated people from different backgrounds. If the complaint is that all these people are somehow the same, from the same small group that therefore fails to represent the nation, then let’s widen that group to be far more inclusive without losing whatever the features are that makes it worth having. In other words, perhaps we need to make the class of jobs more appealing in general and less appealing specifically. That suggests to me that we might need to broaden the intake while trying hard not to lose the quality. I think that amounts to on-the-job training, seriously professional attitudes and an ethos that makes all sorts of cronyism unattractive. In turn, that probably means that the transparency such as {1] and [2] call for needs to be in place.
Of course, there’ a circular element to this. if we have corruption in the corridors of power then the mechanisms of reducing whatever corruption there is is countered by the very fact that the power is in the same place that needs to be investigated. it is altogether too easy to starve those investigatory agencies of funds and resources (while at the same time lauding their existence, of course) Paraphrasing from the IPCC, Fewer than 1 in 400 of reported cases are investigated.
"Corruption is not an effect of power, corruption reproduces power. Corruption is a means by which institutions maintain and concentrate power” from [10 b]
Inevitably, almost, the Long Read produced a similar piece. [11] ²; I paused overnight and there it was in my inbox. As the past decade has made clear, nothing turns voters against liberalism more rapidly than the appearance of corruption: the suspicion, valid or otherwise, that politicians are exploiting their power for their own private interest.
David Whyte [10] points out that the corruption in Britain is institutional. "Corruption is not an effect of power, corruption reproduces power. Corruption is a means by which institutions maintain and concentrate power” from [10 b, me transliterating what he said in interview]. That short phrase, corruption reproduces power reads like the summation of a lot longer piece of writing, in that one might well need to take in a lot to so as to understand the implications of those three adjacent words.
"Wherever power is concentrated, we have to open these places up so that they are vulnerable to public demands, unless we can empower communities and the public to challenge power, we will still have a problem of corruption" from [10 b]. All of which i agree with, from my own explorations of the topic.
One of the effects of Mr Trump (I can’t accord him the title) working to divide and define the white man as a minority is that that same group is then identified in a bad way. So our many public school figures in Britain are all tarred with a brush that labels them as, somehow, self-interested or, at best, interested in furthering the prospects of people like themselves, somehow labelled as the Establishment. That is divisive and I see that division as a bad thing. It is also conducive of persuading us all that no-one in power could possibly be telling the truth, nor behaving honestly (they are not necessarily the same thing). So whether we have corruption no longer matters, since the perception is now that all behaviour of those in power is necessarily corrupt. That is an awful position for a society to be in and we need to find ways of building trust so as to divert ourselves from disaster.
Yet I note that in my own employment there was a level at which apparently obvious decisions became political, in the express sense that decisions were made to further self-interest, possibly the perceived interests of the company as a whole, but not—quite definitely not—the interests of the education we were supposed to be in business for. I found this corrupt most of the time; either people were pushing an agenda for what were quite clearly motives based on personal advancement, or were running away from almost the same thing, a policy that furthered the company business at perceived cost to their particular fief or comfort zone. All that I learned was that there is a level at which decision become political. In that sense of political that reeks of the exercise of power and at the same time far too rarely has any taste of being for the benefit of everyone. I found the levels of displayed dishonesty awful, the naked greed ugly and the ease with which people stepped over a line into outright fraud truly scary. It makes me wonder just how corrupt our societies are. I use the plural because societies are not uniform in what is considered acceptable behaviour. How do we put people in positions of trust when they are clearly not worthy of that? Is it that those with the power of appointment recognise themselves? That makes the trustworthy almost guaranteed to be also the fall-guy.
This absence of trust is necessarily a cause for concern. as [11] says, What nobody foresaw was that, when trust sinks beneath a certain point, many people may come to view the entire spectacle of politics and public life as a sham. This happens not because trust in general declines, but because key public figures – notably politicians and journalists – are perceived as untrustworthy. It is those figures specifically tasked with representing society, either as elected representatives or as professional reporters, who have lost credibility. It doesn’t matter whether they are or are not corrupt if they are perceived as corrupt anyway. Worse, since they represent our society, we are tempted to see our whole society as corrupt. How do we fix this? How was trust lost? Is it worse, that trust has been withdrawn? Surely in the digital age we have access to a lot of information. While some of the information is itself corrupted and while a lot is echo-chamber material, it is not beyond our abilities to establish what is or is not – and yet I find material each time I write that says this is difficult. A good deal of this problem lies in the ease with which one can publish—as I do myself—so that it is increasingly difficult to know what sources are in any sense reliable. Thus a genuine expert can be adjacent to a bigot and we find it difficult to accord either a measure of trust. As [11] says, By lumping together journalists, judges, experts and politicians as a single homogeneous “liberal elite”, it is possible to treat them all as indulging in a babble of jargon, political correctness and, ultimately, lies. Their status as public servants is demolished once their claim to speak honestly is thrown into doubt.
Research from [12], ³ shows that this inequality gives an explanation how the deliberate liar can appeal to prejudice in a way that is politically attractive: for the lying demagogue to have authentic appeal, it is sufficient that one side of a social divide regards the political system as flawed or illegitimate.
This issue of trust may require a separate post; meanwhile read [11]. Do note the potential for muddling scandal with corruption. ⁴ It may be that I have to extract from here what is about trust and not corruption.
Back to corruption. There are some classification (oh, here comes the academic bit, perhaps). I found several different approaches to this, even as I restrict myself to political corruption. Do read [13] for a wider grasp of the subject. The World Bank defines corruption as the abuse of public power for private benefit. ⁵ Those private benefits are usually seen as wealth, power or status. For the corruption to be political, it must involve political decision-makers. Continuing to inspect Britain’s perception of corruption and wondering how our perspective on this has changed, I am reminded of my recent visit to the National Crime Agency site. Do see [15], a National Strategic Assessment, but then wonder how we have created an environment where such high-level crime is possible – and then provide so little resource to deal with it. [15, p23]: A small number of individuals in positions of authority - such as the accounting and legal services, trust and company service providers, or in banking institutions - have been identified as corrupt. They have played pivotal roles in complex money laundering schemes or divulged information to help bring credibility to fraudulent schemes. They are also used to assist corrupt politically- exposed persons (PEPs) investing in the UK, showing that domestic and international corruption are interlinked. The NCA has what looks at first like a big budget, but the way in which our police forces are set up works against fighting anything other than local crime, so there is an understandable call for a re-think of how we drag policing into the 21st century, perhaps a two-tier national and county system, federal and local. As police commissioners tell us how policing has to be targeted to stay within budget, so is revealed a list of crimes that probably will not be pursued for a variety of reasons amounting to ‘too expensive’. Definitely we need to rethink how we control our society; surely self-regulation is key, here? Is is not ‘their’ problem, it is ours. Try [16] and [17]. ⁶
The following paragraphs perhaps ought to use the reversed interrogative,⸮, since they are not going to elicit answers. See 251.
So where quite was the corruption that left the bankers involved in the 2008 banking crisis richer, not poorer? How is the power that empirically lies in the City generate power over our politicians? Is that the elite working to preserve itself?
How is it in any sense right that Ministers resign and walk into extremely lucrative part-time jobs at the same sort of rate as star footballers? How is it right for an MP to have a second job which almost automatically requires him or her to share what are tantamount to state secrets? How can a privy councillor also be a company director or a lobbyist? is this not wrong? Was the MPs' expenses scandal of recent years just a scandal or something more near to corruption – indeed were some on opposite sides of some line to be drawn?
I see little or no difference between the financial offence of inside trading and the political parallel, use of knowledge for personal gain or advantage. I wonder whether the position is different once a politician is no longer active, but also whether there should be some equivalent to gardening leave. I’m pretty sure that people who have been privy to state secrets (privy councillors) need to be seen to continue to keep the secrets with which they have been entrusted.
All of this comes down to trust. It may be that we can deal with this by having suitable layers of transparency. But with transparency we also need to see that people who breach trust are appropriately penalised. For example, the recent activity to explore the income sources for prolific spenders is surely to be applauded, but I worry that most such legislation has tended to percolate so that it is the non-elite commoner who is hit by changes in regulation (think of the work required to move money around these days, called anti-fraud detection, which I see as much the same as the metal detectors at airports, mostly useless, but perhaps a deterrent. Showing that you cam e by your money legitimately is right and good, but I have myself a pile of money earned in China that I can’t actually ‘prove', since (i) I couldn’t identify what paper might be important at the time and have no idea if I missed some opportunities for evidence of proof (but certainly didn’t think of needing it at the time) (ii) whatever paper i had was often taken away by the next official I ended up arguing with about some other topic (iii) I’ve moved so very often that even if I had had some evidential paperwork, I certainly don’t have it now. Come to think of it, I’d have difficulty evidencing most of my income or capital for the last fifty years. Maybe different rules apply when the sums are seven digits and upwards?
DJS 20181129
[2] https://www.transparency.org/glossary/term/corruption
[3] https://en.wikipedia.org/wiki/List_of_political_scandals_in_the_United_Kingdom Is not corruption, but scandal.
[4] https://www.business-anti-corruption.com/country-profiles/united-kingdom/
[5] Quora https://www.quora.com/How-corrupt-is-the-UK
[6] https://www.transparency.org.uk/publications/corruption-in-the-uk-overview-policy-recommendations/
[7] https://www.independent.co.uk/news/uk/home-news/roberto-saviano-britain-corrupt-mafia-hay-festival-a7054851.html Unimpressed, actually; I want a lot more content.
[8] https://www.theguardian.com/uk-news/2017/jan/14/corrupt-money-crept-britain-property-kleptocrats
[9] https://www.theguardian.com/commentisfree/2015/mar/18/corruption-rife-britain 2015, but not wrong.
[10] https://www.amazon.co.uk/How-Corrupt-Britain-David-Whyte/dp/0745335292 also https://www.plutobooks.com/blog/how-corrupt-is-britain-david-whyte-video/
[12] https://journals.sagepub.com/doi/abs/10.1177/0003122417749632
[13] https://www.cmi.no/publications/1040-political-corruption allows you to download and read. Short enough to read all of it.
[14] https://pdfs.semanticscholar.org/1be8/6b6ef6ca07e314cbb88c09c2311e52de4344.pdf
[15] http://www.nationalcrimeagency.gov.uk/publications/905-national-strategic-assessment-for-soc-2018/file the document itself
[16] https://fullfact.org/crime/police-funding-england-and-wales/
[17] https://www.thetimes.co.uk/article/police-chief-calls-for-crime-rethink-7f5063wq77x paywall.
[19] https://www.bbc.co.uk/news/uk-politics-33431580 Actually explains quite a bit of the attitude within Establishment. Worrying not to have an explanation.
[20] https://www.quora.com/ Quora answer, (hunt uk political corruption] but it both explains itself and links to [19] Ken Morgan, Paul Davies, Chris Terry
1 I looked at [3] to see what we consider to be political corruption and unusually wikipedia didn’t supply its usually helpful considered content. While I searched on corruption, what i was served was instead scandal, which is not the same thing at all.
[4] declares that corruption in Britain is low and provides detail.
2 Mildly related, this new from the Guardian, discussing why it is that we no longer trust people in positions of trust to be behavoing honestly.
3 …. how can a constituency of voters find a candidate “authentically appealing” (i.e., view him positively as authentic) even though he is a “lying demagogue” (someone who deliberately tells lies and appeals to non-normative private prejudices)?
Key to the theory are two points:
(1) “common-knowledge” lies may be understood as flagrant violations of the norm of truth-telling; and
(2) when a political system is suffering from a “crisis of legitimacy” (Lipset 1959) with respect to at least one political constituency, members of that constituency will be motivated to see a flagrant violator of established norms as an authentic champion of its interests.
... for the lying demagogue to have authentic appeal, it is sufficient that one side of a social divide regards the political system as flawed or illegitimate.
4 I wonder whether the truth we now see as available —if we could only identify it—is in what I might call public documents, even if leaked, while in the past the equivalent information was in some sense hidden, even if sitting apparently available in a library. Doe sthis mean that we need a new sort of politician who demands trust and proves that he or she is worthy of such trust? How woudl we find such a paragon? We won’t, what we need to do is learn to trust the warts-and-all persona presented. Hand in hand with such a figure ther ehas to be a wealth of evidence, a trustworthy base of data, that supports the demand for trust. Which immediately causes us to ask quis custodiet ipsos custodes?, doesn’t it? Link for those that need it.
5 Khan, Mushtaq H.: “A Typology of Corrupt Transactions in Developing Countries” in IDS Bulletin, vol.27, no.2, April 1996. I found I couldn’t access this, so I point instead to [14]. General corruption has forms: Bribery, Embezzlement/Graft, Fraud, Extortion, Patronage, Favoritism, Kickbacks. This source points to a variety of studies on corruption across various academic disciplines. Again, short enough for you to read yourself.
6 I found several places happy to quote the statistic “only 1 in <number> of reported cases are investigated” I found it hard to locate a source. [18] seems to me to be the right place to look. but reported crimes are not a National Statistic. Reporting is not directly connected to actual crime levels; you should investigate what is recorded and not recorded. Concentrate on the classification of crimes reported. For example, changes in the way matters are recorded showed a dramatic increase in stalking and harassment (reported) (what’s the difference, exactly?) which counts as violence (no longer as violence without injury) and accounts for 30% of the measured increase in reporting. Which may be telling us that there has always been quite a lot of this. [19] explains how data is recorded, an interesting thing in itself telling you a lot about the problems within policing. While the figures are openly available for reporting and outcomes, it is hard work and one might believe that the headline figure one might like is actually hidden from view. I would say it is in the interests of the police to demonstrate what they cannot afford to investigate so that the wider public becomes aware quite what their problems are. This might be an aspect of the transparency which is criticised. No, I don’t want to be the individual who is told my case is unsolvable, nor do I want to hear it is not worthwhile, but maybe I need to hear that message. https://www.police.uk/about-this-site/faqs/#why-does-police.uk-not-show-outcomes-for-every-crime
