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Tuesday, January 24, 2023

Tarnished Saint – Ukraine And The Inevitable Corruption Of Free Money

Corruption is endemic to human society.  No country, empire, regime, government, or private sector has ever been exempt.  Whether the Seven Dwarves of the American tobacco industry who deliberately withheld damaging information about the dangers of nicotine and actively sought to boost its addictive properties; Enron who set up shell companies and impossibly complex derivatives to bilk the public and enrich their executives; Bernie Madoff who lied to his Jewish friends and supporters and ruined them while his own financial holdings increased; Sam Bankman-Fried who bilked billions in a high-stakes, rotten-to-the-core crypto-currency scheme; or high officials of Ukraine, tempted again and again by billions in free money, couldn't resist. 

Bernie Madoff, Notorious Ponzi Schemer, Dies At 82 : NPR

The revelation today (1.24.23) that more than ten top advisers of the Zelenskyy government either resigned or were sacked for corruption should have been no surprise to anyone.  For nearly two years Western governments have opened the doors to their treasuries to support what has been seen as a  heroic struggle of a small, independent, democratic nation against a hegemonistic bully.  The conflict is a geopolitical one to be sure, but with moral overtones.  

Zelenskyy is a modern hero, a young leader devoted to his people, and the cause of freedom who can do no wrong.  He, in a carefully scripted scenario, repeatedly faults the West for its moral failure and political weakness, and its spineless, timorous approach to Russia.  He reminds them of the destruction of Srebrenica, the brutal Serbian ethnic cleansing of Bosnia-Herzegovina, and the cowardly refusal of the West to intervene.

Ukraine strengthens independence of key anti-corruption agency - Atlantic  Council

These moral appeals have guaranteed a largesse far more generous than any given for support of territorial integrity.  Zelenskyy and his advisors have been brilliant in securing arms and financing for what now seems to be a perennial war. Many political observers including former Secretary of State Henry Kissinger, architect of modern realpolitik, has criticized both Zelenskyy and the West for their obdurate refusal to compromise to stop the bloody conflict, tens of thousands of deaths, and a physically devastated country. 

It was clear to many that the reason for continued Ukrainian resistance might be political vanity and personal financial gain. There is no way that the billions of dollars in foreign assistance would all go for military defense and civil rebuilding.  Everyone knows that a good piece of the trillions authorized by the Biden Administration for ‘infrastructure’ will be diverted.  Nowhere in the world have major public works projects been clean.  They are opportunities for printing money.

Accountability – while governments insist they will put measures in place to ensure proper utilization of public monies, they can never stop the leaks.  In the US there are simply too many jurisdictions, public interest groups, and private sector interests for all the money to stay in one place.

Since Western governments, motivated by good faith and moral purpose are quite happy to pour unaccountable free money into the coffers of the heroic Ukrainian government, of course it will be misused. Not only that, pre-war Ukraine was never a model for clean, transparent government, so what do you expect now from this Christmas in July generosity?

Political corruption in Ancient Rome is one of the principal reasons cited for its downfall:

One of the most difficult problems was choosing a new emperor. Unlike Greece where transition may not have been smooth but was at least consistent, the Romans never created an effective system to determine how new emperors would be selected. The choice was always open to debate between the old emperor, the Senate, the Praetorian Guard (the emperor's private army), and the army.
Gradually, the Praetorian Guard gained complete authority to choose the new emperor, who rewarded the guard who then became more influential, perpetuating the cycle. Then in 186 A. D. the army strangled the new emperor, the practice began of selling the throne to the highest bidder. During the next 100 years, Rome had 37 different emperors - 25 of whom were removed from office by assassination. This contributed to the overall weaknesses, decline and fall of the empire.

Electoral corruption was rampant, and most historians conclude that Julius Caesar won the office of Pontifex Maximus through electoral bribery.

In a letter to Lucilius, lamenting the electoral corruption in Rome, Seneca wrote:

Call it enjoyable when the tribes are called together and the candidates are making offerings at their favorite temples – some of them promising money and gifts…and wearing down their hands with the kisses of those to whom they will refuse the least finger-touch after they are elected…(Lisa Hill, ‘Conceptions of Corruption in Ancient Rome and Greece).

Image result for images seneca rome

Ancient Greece was no different.  Despite its reputation as a philosophical idyll, it was run by bureaucrats like most countries.  Aristotle himself estimated that the city of Athens alone had 20,000 public employees who were badly paid and ‘made ends meet’.
Corruption in Imperial China was no different as Andras Csuka writes :

Corruption in China dates back over a thousand years and has been present through countless dynasties. In fact, widespread corruption is often cited as one of the factors that led to the collapse of the Qing Dynasty in the 19th century.
As a result, the labyrinth of bribes and favors, corruption became an integral part of the entire administration. A European traveller in the 18th century described Chinese corruption as follows: “The man who preserved his integrity is generally considered as incapable or a dreamer. It is not easy to swim against the stream.”
In this complex system it was only normal that government officials would trade their influence for money. They also formed strong cliques to protect themselves from punishments by state businessmen, officials, military leaders and other high ranking state employees.
English monarchs have been no different.  John raided the monasteries to finance his ill-conceived wars.  John, Henry VI, Charles I, Mary I, and Richard III used the power of their regency to retain it at all costs, defying any and all rules of court, Church, and kingdom to attain their ends.

African dictators have a long and sorry history of corruption. The leader of Ethiopia who either just died or was murdered was a dictator, and despite years of misrule, was the beneficiary of billions.  Idriss Deby, the dictator of Chad played the US and the World Bank for fools, duplicitously agreeing to a gas-for-reform agenda and then reneging completely and continuing his despotic rule over one of the poorest countries in Africa. 

The lionized Kagame presides with a repressive regime which muzzles opposition.  He has lied or distorted reports about his support of anti-government clandestine military operations in the Congo.         

Image result for images bokassa

Why is corruption so universal?

Although large public sector bureaucracies have been cited as hothouses for corruption whether in Ancient Greece or modern-day America and Africa, they are facilitators of corruption, not the underlying cause.  Their low pay, subservient status, and lack of advancement are more important factors in bending or overlooking rules and regulations for personal gain.

“Power corrupts and absolute power corrupts absolutely” said Baron Acton.  Not only are those with limited power given to corruption; but those with immense power are even more so.

Is corruption endemic because of the lack of moral authority?  Doubtful. Church and State were one throughout most of history.  The threat of excommunication by the Pope reined in all but the most self-serving ambition of English kings until Henry VIII defied them; and most ordinary subjects feared eternal damnation for their sins. 

Yet even in such societies governed by strict moral precepts – every religion has its injunctions against lying, stealing, covetousness, and deceit – immoral and unethical behavior are rampant.   Although these principles are taught and passed down by parents, Church, community and state, they are routinely and regularly dismissed as irrelevant, inapplicable, or outdated. Both the Old and New Testaments are very clear about moral codes. 

It is not hard to see, therefore, how self-interested politicians, ordinary citizens, and family members resort to corrupt, venal, and manipulative means to achieve their goals.  Not only is history filled with chronicles of political distortion and overweening ambition, but literature as well.  Shakespeare’s Tragedies and Histories are all about such familiar ambition and how everyone at court, in the Church, or among the populace falls prey to it.

Corruption must be accepted as a normal although unacceptable expression of human nature.  Although until recently there was a hope for The End of History – a new, democratic, equal, and fair world – it has been dashed once and for all.  New geopolitical configurations once unimaginable are changing world order.  Every one within these new configurations must once again sort through the conundrums of governance, civility, ethics, morals, and responsibility.  Until then, corruption will increase.

What must not be forgotten is the complicity between donor and recipient of foreign financial aid.  So-called ‘development’ programs have perennially failed to reach their objectives because of corruption.  The World Bank, the US government, and Western European nations have all wanted to donate money far more than poor countries have wanted to receive it; and in such a culture of moral disparity it is no surprise that money goes missing.  

Not only that, because of the pressure Western institutions feel to spend the money allocated for foreign assistance, they continue to push it out the door despite the continued non-performance of their loans and grants.

Guarantees Program

This is the case in Ukraine.  Money is being poured down the sluice, and nobody is paying attention to where it ends up. So, what do you expect?

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