The culture of corruption; too long a way of life?

Since early March, stories about corruption have occupied the front pages of the nation's newspapers. The public lapped up these stories avidly, but was not shocked. It is clear the electorate has long been convinced that graft permeates every aspect of national politics. They have suffered the consequences of this plague as long as they can remember.

Corruption isn't new, nor did it emerge with the recent video scandals haunting the Party of the Democratic Revolution (PRD). It was denounced emphatically during the 2000 presidential campaign that brought to power the new political elite of the National Action Party (PAN). And before that, the widespread nefarious practices of the Institutional Revolutionary Party (PRI) during its 71-year rule were the target of critics demanding political transparency.

What is new, however, is that changes in the political landscape, with parties and politicians of divergent backgrounds, have not been able to overcome the depravity that assails Mexican society. And it threatens the nascent democracy that has been under construction with debasement or even extinction.

Members of the PAN, the PRD and even the Green Party can be measured (to their own discredit) with the same yardstick as their infamous predecessors from the PRI. The novelty has been watching prominent politicians from these parties captured on videotape negotiating corrupt deals.

BACK TO THE GOOD OLD WAYS

The tragedy of these recent scandals is that they appear to put Mexico back on the slippery downhill slope to dishonesty in public transactions. The National Survey of Corruption and Good Governance (NSCGG) showed a gradual improvement between 2001--the first year the survey was conducted--and 2003. In 2001, 10.5 of each 100 public service transactions "required" a bribe to ensure completion, while by 2003 that figure had been reduced to 8.5.

The latest NSCGG (measuring activity from Oct. 2002 through Oct. 2003) registered 101 million acts of corruption with an average cost of 107 pesos per family. This represents an average of 7 percent of the income of the typical Mexican family, while for the poorest category it represents nearly 30 percent of household income, making the phenomenon even more unjust.

The states that registered the least corruption, according to the NSCGG, were Baja California Sur (2.3), Quintana Roo (3.7), Colima (3.8), Hidalgo (3.9) and Aguascalientes (3.9). The areas where corruption was most widespread were Guerrero (12), Durango (12.6), the State of Mexico (12.7), the Federal District (13.2) and Puebla (18).

The survey results also shatter some preconceived notions, primarily that the more educated were less likely to succumb to corrupt practices. The figures show that among the most educated sectors of society (high school and university graduates), the tendency was most pronounced (10.4 and 10.2, respectively).

If politics is perception, Mexico's political class should be concerned that the public perceives them as the least qualified to combat corruption and the most likely to accept it.

In 2002, Mexico placed 57th in a global survey measuring corruption in 102 nations. To grasp what this number represents, we can look at the nation considered the least corrupt--Finland. The Scandinavian country earned a 10 out of 10 for transparency, while Mexico earned a 3.6.

The troubling aspect of this study is not that rich countries appear to have lower levels of corruption, but that the levels are rising in the poorest countries. When the 2002 Transparency International (TI) report was presented in Berlin, TI president Peter Eigen asserted that "the corrupt elites in developing nations who work hand-in-hand with unscrupulous investors are placing more importance on reaping benefits for themselves than on the welfare of their citizens or the economic development of their countries."

He further emphasized that "the political elites and their cadre continue to accept bribes at the drop of a hat. Along with corrupt businessmen, they are trapping entire nations in a vicious cycle of poverty and blocking prospects for genuine sustained development."

Here in Mexico, the problem is further compounded by the inability to effectively punish corruption among the political elite. Beyond denials, excuses or acts of contrition, the culprits enjoy impunity and remain at large. Like never before, Benito Juarez's famous old maxim seems applicable: "To our friends, fairness and gratitude; to our enemies, the cold interpretation of the law."

CORRUPTION HINDERS DEVELOPMENT

It is important to recognize that the phenomenon of corruption goes beyond the individual that benefits directly from the practice (i.e. politicians, officials, bureaucrats, businessmen, etc.). As noted by Guillermo Marin in his essay "La corruption en Mexico: una estrategia de resistencia cultural," corruption "is a major detriment to society because it destroys, debilitates, disarticulates, splits and disintegrates any and all national, political and social projects."

Corruption impacts price setting and generally contributes to higher inflation; it undermines product quality and pushes up service costs by around 15 percent. This increase can be seen as a "corruption tax" which suppliers and service providers must pay to get their product to the end consumer.

If these figures seem high to the public now (we can refer back to the recent congressional debate about the controversial 5 percent increase in value-added tax, bringing that total charge to 15 percent), when the impact is translated to the macroeconomic level it reaches astounding proportions.

Not only does it dissuade foreign investment (the Price Waterhouse accounting firm calculates that Mexico loses roughly US$8.5 billion in potential investment each year. Compounding this, in 2003, foreign investment was down 25 percent from the previous year, totaling only US$10.731 billion), but it also drastically hinders internal investment.

Most private sector analysts, such as the CEESP, have estimated that up to 30 percent of government spending (or about US$5.7 billion) is lost to corrupt practices or bribery.

The Organization for Economic Co-operation and Development (OECD) has estimated that not only does Mexico collect the lowest percentage of its GDP via taxation (a mere 12 percent) among its members, but that tax collection is heavily (and negatively) influenced by corruption. The organization suggests GDP is negatively impacted by anywhere from 0.3 percent to 1.8 percent, causing further loss of dynamism in investment and market distortion. Mexico signed an Anti-Corruption Treaty with the OECD in 1999.

[ILLUSTRATION OMITTED]

DEMOCRACY AT RISK

More serious, however, is the political effect corruption has on the public. John Bailey, director of the Project Mexico in the Center for Latin American Studies at the University of Georgetown in Washington D.C., says "corruption is correctly perceived as an obstacle to the construction of democratic governability. Corruption leads to the squandering of already scarce resources and dampens public support for democracy."

What is at risk then, is our incipient democracy. Across the political and social spectrum, the current "democratic" system is seen as making life more expensive and yet is incapable of offering the minimum guarantees demanded by the public.

It is not a coincidence that politicians and public officials--including members of the judicial branch--are perceived by the public as untrustworthy and very susceptible to corruption (or, in other words, as the prime beneficiaries of corruption). This leaves little room for any expectations that strong political institutions capable of addressing the issue of corruption will evolve.

Peter Eigen insists that "combating corruption offers the opportunity to think about the future of a nation and it is the most effective way to utilize scarce resources to foster development."

But the public sees this very future being mortgaged when the political system is incapable of reacting adequately to instances of corruption or institutions that tolerate it.

The most significant impact corruption has had on Mexico is the limits it has placed on its future. This phenomenon is endemic and the only way to effectively eliminate it goes beyond well-intentioned promises by politicians and government officials. It requires legal reform that effectively punishes anyone-especially public officials--who takes part in corruption and makes an example of them, without exception.

This is the only way the political class can regain the confidence of the that public no longer cares to differentiate between party symbols and colors, instead only seeing politicians with their hands in the till. It is getting to the stage where the long tradition of corruption here is making it difficult to imagine it is possible to live any other way.

Gilberto Meza is a journalist with over 30 years experience in Mexico and Europe. Meza currently is a counselor with Cimac (Comunicacion e Informacion de la Mujer, A.C.)