Corruption, religion and economic growth

Article by Philip Booth in the Catholic Herald

We probably all agree that corruption is wrong – but do we really understand the damage it causes? Indeed, do we know what corruption is? And, should we be surprised that Catholic countries are some of the most corrupt countries in every region of the world?

Corruption can probably best be defined as making a covert payment to those who have the authority to deliver a favour. Examples include individuals bribing a judge or traffic warden and large companies making payments to government ministers to influence the outcome of a tendering process.

There was some discussion of corruption during the “Make Poverty History” campaign. Arguably corruption is a major cause of poverty. Corruption in many poor countries is not limited to the leaders of poor countries: it is endemic. Indeed, it can be at its most damaging at lower levels in society where it affects everyday economic life. If a contract dispute is being taken to court and is settled in favour of the person who bribes the judge, or if property titles are only granted to those who bribe the relevant government administrator then normal economic life as we know it in the West cannot develop.

But what about corruption closer to home? A recent study by Ian Senior, published by the Institute of Economic Affairs, suggests that there is widespread corruption in developed countries and in their international institutions. In France, two recent presidents and two prime ministers have either been found guilty of corruption or have been implicated but not fully investigated because of a legal system that gives immunities to the top people. Italy and Japan have similarly had their highest ranking politicians absorbed in corruption scandals. Neither the EU nor the UN appear immune either – though their procedures for holding senior officials and politicians to account are so opaque that it is likely that much remains uncovered.

Indeed, it is a disturbing feature of political and judicial systems in the developed world that it sometimes seems impossible to hold politicians to account for corrupt activity. Where investigations take place they are often either in secret or conducted at snails pace. In France, the President has immunity from prosecution.

In the EU, when Edith Cresson was investigated for suspected inappropriate financial relationships with her dentist, it took five years to check minor factual matters relating to employment documents and then the European Court decided not to prosecute at a hearing that took place behind closed doors. More generally, the EU’s auditors have refused to sign off its accounts for eleven successive years and whistle blowers and those who bring to light inappropriate financial behaviour have been sidelined, suspended or intimidated. In Ireland, the Moriarty Tribunal has been investigating corruption in the political system since 1997 and still shows no sign of reporting. So far the Tribunal has cost Irish taxpayers €18.6m.

I have already mentioned Italy, France and Ireland – three Catholic countries (though one has a strong secular tradition too) - in connection with corruption cases. Ian Senior’s study finds that one feature strongly correlated with corruption is whether the country is religious. Of course direct cause and effect cannot be drawn but it is rather worrying that more religious countries, as defined by church attendance, tend to be more corrupt.

All the major religious faiths teach something akin to a Catholic understanding of natural law – certain actions are always wrong, in all times and places, regardless of whether they are against the law of a particular country or not. Religious countries should be less corrupt if the faithful follow their own declared beliefs. Ian Senior, author of the IEA study, has speculated elsewhere that confessing Christians might believe that they can commit sins, confess them and not mend their ways but feel reconciled with God. It has been said that Calisto Tanzi, the jailed CEO of Parmalat attended confession daily. Of course, confession is not valid without a “firm purpose of amendment”.

There are many factors to do with the general government policy framework that seem to encourage corruption. In some countries basic legal structures are absent and local barons thrive on and therefore encourage corruption. Also, high levels of regulation seem to lead to more corruption. Certainly trade regulation in under-developed countries attracts corruption like a magnet. If government officials are given the power to restrict imports by imposing tariffs or quotas those tariffs or quotas can often be overcome by covert bribes.

Indeed, once the culture of corruption has settled in, even legal imports are frequently delayed by bureaucratic processes unless covert payments are made to the relevant customs officials. In some cases the morality of the issue can become blurred for potential corrupters. If I am sitting outside a customs post in a tropical country with a lorry load of fresh fruit, is it moral or not to bribe the customs officials who will let me through for a covert payment?

Given that religious countries are not exempt from corrupt practices it is worth considering what the Church could do. Both at local and magisterial level the Church has certainly criticised corruption in principle but She could be much firmer in stating the seriousness with which corruption should be regarded – both in rich countries and in the under-developed world. It is the Christian view that to be part of a country’s government is to put oneself at the highest level of service to others. Corrupt acts by those in government cannot be tolerated.

Arguably, corruption in government is worse than outright stealing as it dis-empowers the weak and empowers the already strong. Rather like an extra-marital affair, the secret nature of corruption distorts people’s whole moral outlook: the corrupted excuse their actions, cover their tracks and begin to redefine right and wrong in their own minds. Bishops in the European Union would have good reason to make a strong collective statement on this issue referring both to individual nation states and international institutions.

At a lower level, advice on the circumstances in which corruption is wrong might be helpful. Is corruption always wrong or, in the above example, is it morally right to bribe the customs officials to allow a lorry load of fresh fruit into a country full of hungry people?

It is certainly arguable that the Church has been slow to see the link between issues such as foreign aid and trade regulation and corruption. Populorum Progressio suggested that Catholics in good conscience should support more taxpayer funding for foreign aid. But, what if government-to-government aid encourages the corrupt structures that keep people poor by providing more largesse to the already rich and powerful? If we can help the poor to prosper then we should, but, if the methods we choose to try to help the poor are counterproductive in practice, we should question them.

Rooting out corruption is fundamental to achieving greater justice. Church leaders should give a very clear lead on this issue: corruption by government officials cannot be tolerated. To live a Catholic life in government means rejecting the temptation to be involved in corruption.

email the author:
Philip Booth

See also
Corruption - The World's Big C
, by Ian Senior, published by the IEA. Hard copy can be purchased or downloaded for free.

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