Why Scams Are Here to Stay

Book Review

‘Corruption is a problem of political economy.’

We live in the midst of scams and scandals- a scoundrel times, but simultaneously we also have become accustomed to corruption. The book under review is an attempt to get the measure of political corruption in contemporary India and see what could be done to combat it. The book can be contextualized in two specific events– the first being the so-called surgical strike against black money- the demonetization as implemented by BJP government. But slowly all the black money has flowed back into the economy as white notwithstanding the tall claims of the government. Second is the final verdict of the supreme court in Jayalalitha disproportionate assets case.

If corruption is to be understood in its pervasiveness, its omnipotence, and its multifariousness, argues the author, so that something meaningful is to do, it needs to be conceptualized and approached not as a problem of just politics, economy, society, moral sphere but of the political economy in its complex, interdisciplinary sense. There is a need to disaggregate it, this can be done by looking at the effects of specific types of corruption in society, and there is no other way to make sense of corruption. There are different standpoints on how corruption is essentially generated. For anti-corruption crusader like Anna Hazare, it is ‘moral degeneration, ‘but such supine argument fails to capture the true character of corruption. Likewise, liberal theorists deal with corruption essentially as a problem of the public sphere with bureaucrats as being their pet target. On the contrary Marxist theorists present it is as a problem of political economy.

The Multifariousness of Corruption

In the twenty-first century, India has seen corruption increasing exponentially at all levels. It entails nexus between elite and lumpen elements who have graduated to a new qualitative stage transforming itself into the new rule based self-propelled system of collecting and sharing the illicit spoils of office. The view that corruption is pervasive in India is not of recent origin. It goes back to the days of the East Indian company when spoils were shared by nabobs. But colonial narrative made India appear an endemically corrupt society. Many scholars have expended their energy and commented on the danger it entails for India. Legal scholar Upendra Baxi pleaded for its minimization as he finds corruption having the chance to undermine democracy leading to authoritarianism. Gunnar Myrdal’s work ‘Asian Drama’ is primarily concerned with the damaging impact of corruption on society and politics across south Asia. He proposed it is the interplay of three phenomena. Folklore- people belief as disclosed in public sphere, anti-corruption arrangements- laws and institutional arrangement to enforce integrity. And finally, the facts about corruption- nature, forms, extent and those involved. He linked it with general social-economic conditions. But such ahistorical work has exonerated the British imperium for its role in increasing it. While folklore has kept in step, the anti-corruption arrangements have been limping a long way behind. The problem in India regarding corruption is that gap between what anti-corruption crusaders demand and what the polity, legal system is willing to do is enormous. When corruption is not conceptualized soundly about its political, social-cultural economic factors, but presented in simplistic moral terms, it tends to go all over the place. Therefore mass anti-corruption campaigns fail to sustain itself for long.

Sources of Corruption

It is a fact that there exists a two-way relationship between the corruption and black income generation, and this constitutes the central problem of India’s political economy. The pervasiveness and high level of arms trade corruption in India are well recognized. The focus of the corruption in India is exclusively on public sector with the result private sector frauds rarely figure in mainstream media and public discourses on corruption. The author pleads that it must be recognized as one of the most toxic forms of corruption. Electoral finances also involve corruption on a grand scale. But the variability of the national laws regulating campaign financing and donations to political parties and the seriousness with which they are enforced can make all the difference to the incidence, forms, and scale of this type of corruption. In fact, the recognition of donation creates a reciprocal relationship between the business world and the political class. Decentralization and devolution of authority to the lower units has resulted in the proliferation of the corruption and will continue if lowest units are captured by locally powerful people. Siphoning off money dovetailed to anti-poverty programmes is now a well-organized form of corruption. Another equally but dangerous source of corruption is paid news. Paid news is deeper malice that takes place around the year in cooperation with the corporate sector, politicians, and special interests. Compromised journalism cannot play a significant, let alone a leading role in investigating exposing or combatting corruption in politics and society at large.

Conceptualizing the Corruption

There was a time when the stock explanation for corruption in India was the existence of license-permit raj and the antidote prescribed against it by the neo-liberal theorists had been deregulation and liberalization as it was anticipated that it would lead to the prevention, containment and eventual elimination of corruption. Precisely opposite happened. The neoliberal order has unleashed corruption in a much greater variety of forms and on an unimaginably greater scale than seen under the license Raj. The essential neo-liberal answer for the proliferation of corruption is that many vestiges of license raj remain, and enforcement capacity is weak, and reform process needs to be given more time to take roots.

Economists often define corruption as the use of public office for private gains. It leaves out the use of private office for private gains. And serious flaw with this definition is that it fixes the spotlight on bureaucratic corruption and leaves out the political corruption. For neo-liberal economists, the model corruption is derived from the rent-seeking theory- the quest to get a return without contributing. And the standard prescription veers towards a narrow policy path. This rent seeking behaviors engenders from the set of the controls placed by the government upon the economic activities. Since the government is organized theft, the less of it, the better. But with the onset of liberalization, corruption has spread its tentacles everywhere which disprove the logic of neoliberal economists. Just as corruption cannot be conceptualized in isolation from politics and society, it’s servicing as a political economy mechanism for private aggrandizement in which private sector and the state play closely aligned roles is crucial to understand its various forms and manifestations.

The Marxist understanding of the corruption is that it has always been the inherent feature of capitalism, not a moral blight, or an ethical lapse and that is prevalent in all types of societies whether under bourgeoisie democratic, authoritarian regimes or military dictatorships. It sees corruption as a problem of political economy and leaves no doubt about the classes at the root of it. Central to the Marxist understanding of political corruption is the omnipresence of private interests within the public sphere. By this logic, the fount of corruption is the big business and neo-liberal policies. It is the illegal money generated by big business and the corporates which have corrupted the system not the other way around. The political system is getting molded to accommodate the interests of proliferating capitalism. Contemporary Marxist writings on the subject challenge the notion, promoted with assiduity by transnational capital and actors of corruption as “opacity” and the consequent prescription is transparency. This addresses the bureaucratic corruption not the corruption of political economy. They don’t buy the technocratic and moralistic fixes favored by mainstream anti-corruption crusades and instead argue for an ahistorical materialistic approach to the question of political corruption today. They suggest that it is the institutionalized corruption at the top which creates and sustains the petty corruption at the bottom. Rejecting the neo-liberal discourse on the corruption of being responsible for underdevelopment, Marxist theorists assert that it is used as an economic variable for economic growth. Therefore corruption is playing its role in India and China’s high economic growth story. The key reason for the exponential growth of corruption is the shooting up, as a consequence of high economic growth, of the market value of scarce public resources such as land, oil, gas fields, mineral resources, and the enhanced opportunities for making money from their favored allocation by a public authority. In the pre-liberalization era the source of corruption at high levels was big business bribing ministers and officials to seek favors either for licenses or for bypassing certain regulations, But with liberalization, everything is up for sale, and state is handmaid and the facilities for the transfer of money from the state to big businesses. The crux is that even if the Marxists don’t claim to have answers to all the questions of corruption, yet moral crusaders can learn from theoretical postulates of Marxists.

If the objective is to understand corruption in India in its pervasiveness, its multifariousness so that something is done, it needs to be approached as a problem of political economy. Without making profound changes to India’s political economy, it will not be possible to prevent and eliminate corruption. It is unreasonable to suggest that the fight against corruption in India must wait for a revolution, it must be taken as a national task. It must be responded to strategically, in stages and with an eye to weaken and undermine it, rather than concentrating on its symptoms.

The book is replete with a valuable suggestion which can be institutionalized to combat corruption. The book is cogently argued, pithy and can be a valuable guidebook for those concerned with the hydra-headed problem of corruption. It scathing critique for various theoretical postulates across the ideological spectrum is penetrating. Views on the topic are a lively and valuable addition to the existing literature on the subject.