How to Solve the Cancer of Corruption

Tim Worstall | 28 February 2021
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We have to design a system so that corruption does not pay and is not even worth it

Corruption is a problem everywhere -- it is simply one of those temptations that all humans are prey to. 

Our task, therefore, is not to try to wipe it out, to extinguish it, because we never will. 

The costs of even trying to do so will be higher, substantially so, than the benefits of succeeding -- even though we never can actually succeed. 

Instead, we desire to reduce it to where it is: just another one of those annoying but trivial things that plague us. 

This means we have to design a system so that corruption does not pay and is not even worth it.  

Syed Akhtar Mahmood has given us an interesting structure to think about the subject in this newspaper. 

There are “open” deals anyone can partake in -- say, driver’s licence without having to actually take the test, or even know how to drive -- and closed ones, which are reserved for a special and privileged group. 

There are also “ordered” deals, where a deal or a price delivers, without doubt, a result and “dis-ordered” ones, where the result is variable.  

We should, of course, be against all four forms of corruption, all possible combinations, because they are all violations of both democracy and fairness. 

We, humans, do place great value on people being fair too. 

However, it is also possible to take this further and rank the four types in order of awfulness.

The least damaging is open and ordered. 

Say -- and just as an example, not a reflection of any reality -- an import certificate costs Tk 10,000 and anyone with Tk 10,000 can get one. 

No, we are not happy about this but this does just mean that any import shipment has just risen in price by Tk 10,000 and that's all. 

It is just another price in the economy, just like whatever the shipping cost is. 

We can deal with that even though we are really not happy with the bureaucrats lining their pockets at our expense and all the rest. 

It is even, in certain circumstances, possible to say that this is a good thing. 

If getting an import certificate legally costs Tk 100,000 in time and effort, then getting a bribed one at Tk 10,000 will be beneficial to the economy as a whole.

And yes, it is possible -- although, surely this is not true of Bangladesh today -- that a bureaucracy can be so stultifying that effective bribery, this open and ordered kind, makes matters better.  

If the process is dis-ordered then we introduce uncertainty into the economy. 

It is not just that one might pay the fee; it is that you don't know whether the result will be delivered.

This is much more damaging -- uncertainty always is -- than the mere bribery problem.

Then there is that closed part of the process. 

If anyone can get into the system then it is just another price. 

But if the ability to take part is restricted to those special people then they gain privilege.  

And the people who have privilege are rarely the people who are good at doing things other than gaining privilege.

We thus have a cascade of undesirability from open and ordered corruption through to dis-ordered and closed. 

We thus need to attack bribery from the bottom up.

The way to kill the closed version, the one that gives special permissions only to the insiders, is to stop the bureaucracy from having discretion. 

If it is not possible to offer different treatment then no one can buy different treatment, can they? 

So, we must have a simple rules-based system. 

If you meet these criteria then you gain the licence, the permission, and if you don't, you don't. 

Don't allow, well, maybe, you know, if this or that is added. 

Of course, no political system, no bureaucracy, will be happy with that as the entire point of gaining political power is to be able to make those sorts of decisions.

But there we are, we will just have to make it less fun for them to beat this more pernicious form of corruption. 

The open form is a little more difficult to beat because if everyone is used to having to pay when faced with the bureaucracy then that is just what everyone will be doing. 

We need, instead, to make it -- as is being done with the public campaigns -- socially unacceptable to pay and in that manner, we can make it unusual. Unusual things can then be addressed with the law. 

Now of course none of this stops the -- alleged note, we don't know that this is definitely true as yet -- stories like Delta Insurance and the IDRA chairman. 

Where -- again, the allegation -- is that the licencing bureaucracy demanded Tk 50 lakh to allow the company to keep operating. 

However, by making such events unusual, rather than just the normal course of business (and yes, I have worked in countries where this would be entirely normal) we make it more likely that people will rebel against the demands and report the criminality.

Which is, sadly, about the best that we can do. 

We can reduce the incidence of corruption by reducing the opportunity for it. 

That is, simple and clear rules with no discretion means people will not pay because why should they? 

This will not kill it all off but it will make it rare enough that we can then righteously use the criminal law.  

Which we do want to do. After all, why should some people gain their own private legal system -- which is the true meaning of privilege -- just because they are rich?  

The law is for all of us and should be the same for all.

Tim Worstall is a senior fellow at the Adam Smith Institute in London

This article was originally published on Dhaka Tribune.  
Views in this article are author’s own and do not necessarily reflect CGS policy.