Dispatches

USA: Public Probity, Private Corruption

American Corruption

New York, USA – In the 2015 Corruption Perception Index released by Transparency International, the United States ranks a creditable 16th out of over 170 countries. It could be because the index looks at levels of public sector corruption, in which case ordinary Americans can comfortably say they do not suffer the scourge of corrupt public service dispensing.

Acquiring a driver’s licence, or small business incorporation, or a car registration, usually goes smoothly with no expectation of bribes. If you have the required documents, you get what you need, no matter who you are. After waiting in line at the local Department of Motor Vehicles to renew my licence in upstate New York, the elderly white lady in front of me was told she could not get what she had come for as she did not have the right documents. She was visibly upset, but there are no favours in a public service system that has strong foundations of accountability. I was served in a minute and left a happy immigrant.

In America, acquiring a driver’s licence, or small business incorporation, or a car registration, usually goes smoothly with no expectation of bribes. If you have the required documents, you get what you need, no matter who you are… the US has built a sturdy system of accountability when it comes to the public sector

It was not lost on me that in my own country, Kenya, I had encountered the most humiliating and frustrating experiences trying to acquire just about every document I needed, from a driver’s licence to a passport, a national ID or a company registration. It’s the corrosion-of-the-soul experience thousands of Kenyans endure daily, some during their deepest moments of grief, such as getting a death certificate.

Public servants in the US do not have the luxury of bribing their way out of corruption charges either. In 2009, Mayor Sheila Dixon of Baltimore City was found guilty of misappropriating over $500 worth of gift cards that her office had solicited for charity. As restitution, she stepped down from office and agreed to pay $45,000 to charity. There have been numerous other persons holding high public office who received swift justice for corruption, including Jesse Jackson, Jr and his wife who were found guilty of stealing from their campaigns. Perhaps the most colourful of such characters was the former Governor of Illinois, Rod Blagojevich, who solicited bribes from those interested in occupying the State Senate seat that President Obama had left vacant. As Governor, he held the power to fill the seat for the duration until elections. He was sentenced to 14 years in jail. In other words, the US has built a sturdy system of accountability when it comes to the public sector.

What was paradoxical was that Mr Trump’s supporters never perceived him as a corrupt person, but rather as an astute businessman who simply took advantage of corporate-friendly laws. The revelation that he had avoided paying federal income taxes for 18 years should have knocked him off his pedestal, but it didn’t

However, this does not mean that those in public office have not found a way to engage in high-level corruption. The channels of American corruption have burrowed deep into corporate business, with politicians feeding off of a contractual greed that has no legal ramifications. In fact, American corruption is so extensive it could place the country right at the top of the corruption index were the private sector to be considered. The reason this side of American corruption is important is that it impacts the ordinary person struggling to achieve a dream through honest labour. It permeates the moral fibre of society so that wealthy and powerful individuals who have dominated the private sector are able to get away with ridiculous corruption schemes no public official can get away with. There’s no better example of private sector corruption and bullying than the newly elected American President, Donald Trump.

TRUMP: TRIUMPH OF A DRUNKEN SAILOR

In what turned out to be an election shocker that still leaves many reeling, Americans elected Mr Trump as their 45th president on November 8. The surreal implications of this historical upset are partly about the triumph of murk over mien. Mr Trump never could hide his penchant for the salacious, in speech and actions that had their contestations in court. He name-called his opponents and critics like a drunken sailor, stiffed his workers because he could, disrespected women through slander and sleazy speech, championed a shameless birther falsehood against a sitting president, and openly called for the violence against protesters at his campaigns. In spite of all this, American democracy picked him for its next president.

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PLUTOCRACY: WILL HE REMEMBER THE FORGOTTEN?

What was paradoxical was that Mr Trump’s supporters never perceived him as a corrupt person, but rather as an astute businessman who simply took advantage of corporate-friendly laws. The revelation that he had avoided paying federal income taxes for 18 years should have knocked him off his pedestal, but it didn’t. He had taken advantage of tax loopholes available to the rich, having filed an almost $1 billion loss that allowed him the shady legality of tax avoidance practices. Mr Trump had also refused to release his taxes, a tradition of accountability and transparency that has been observed by many presidential candidates since the early 1970s.

Citizens United allows corporations to contribute to political campaigns as ‘persons,’ with the privilege to hide their identities and amount of contribution. Political corruption has thus become institutionalised. Private individuals now form super PACs (Political Action Committees) that amass massive amounts of money to influence campaigns

The Ethics in Government Act mandates all US presidential candidates to file a Public Financial Disclosure report. Mr Trump never went further than what the law called for, and this did not cost him any loss of support. This unprecedented result of his withholding tax returns indicates just how unimportant financial transparency was for the half of America that voted for him. His financially struggling supporters knew he had somehow risen from bankruptcy to billions, and in a bizarre twist of fantasy, hoped the corrupt fellow could pull off the same trick for them. Exit polls showed that poor Americans with no college education voted overwhelmingly for Trump.

This trend, strangely enough, mirrors the voting patterns of poor villagers in economically depressed countries who regularly vote in a corrupt wealthy politician rather than an honest, poor contender. The idea, perhaps, is to put an astute scammer in office who can do a Robin Hood for the poor. After all, America thrives on a plutocracy that concentrates wealth within an exclusive political and corporate class, and Mr Trump had promised that if he got inside the Beltway, he would remember the forgotten.

HILLARY: AN ESTABLISHMENT WHEELER-DEALER?

Hillary Clinton’s full tax returns disclosure, on the other hand, only won her points for maintaining a tradition of transparency. One interesting thing that voters look for in candidates’ tax returns is how much they give to charity. Altruism balances off any accusations of corruption. Clean as her returns seemed to be, they did not save her from the wrath and accusations of those who believed she was irredeemably corrupt.

She faced numerous questions on her use of the Clinton Foundation for pay-to-play deals. It did not help when leaked e-mails alluded to the charity receiving donations from Qatar and Saudi Arabia, countries known for their financial support of terrorist activity. It did not matter that Charity Watch gave the Clinton Foundation an A ranking for its global impact. The thought of a family-run charity accepting money from those who make it possible for terrorists to attack and kill Americans became an unsettling notion to deal with. It contributed towards the narrative that Clinton was an establishment wheeler-dealer who could not be trusted to bring about any change.

RACE AND CORRUPTION: NOW PERMITTED?

Perhaps the most disturbing aspect of it all is that Trump’s rise gave permission to the shadowy movements of racial hate to emerge from their lairs of masked identities and into mainstream America. White supremacist groups such as the Ku Klux Klan endorsed Mr Trump’s candidacy and became a constant presence at his rallies. These groups have in the past four years grown their membership by over 600 per cent, according to research by the George Washington University’s Programme on Extremism, outpacing the growth of Islamic State followers.

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It is not lost on minorities and white Americans who wish to see a more united country that the slavery upon which America was founded still has its tentacles in the emancipated socio-economic fabric of the country; its claws shackling hundreds of thousands of black men to a profit-driven prison industry, and to police brutality. Many well-meaning Americans banked upon the improbable, that President Obama had been able to kill this beast once and for all and bring in an era of racial Kumbayah across America.

In a spree of deregulation, the Glass-Steagall Act was repealed after over 60 years. It allowed banks to invest people’s money with abandon. The greed level spiked when banks suddenly found themselves with piles of money to play with

Now that the Trump candidacy has allowed for racial hate to rear its head, the thriving of private prisons gains new life. The markets recorded an over 58% surge in the stocks of two private prison contractors, CoreCivic and GEO Group, following Trump’s victory. American prisons also function as modern-day slave houses staffed with corrupt law enforcers who specifically target minority non-white groups. Large corporations such as Wal-Mart, McDonald’s, Victoria’s Secret, Whole Foods and others, contract prison labour to harvest, make or package their products. In the kids-for-cash scandal, Judges Mark Ciavarella and Michael Conahan were sentenced to 28 and 17 and-a-half years consecutively for taking bribes from contractors who ran for-profit juvenile prisons. To increase the prison population and drive profits up, the judges schemed to impose harsh and unjust sentences on youth.

In spite of the shocking statistics that show that the world’s sole superpower has 5% of the global population and 25% of the world’s prison population, this is gleam of hope; once again, American institutions of justice showed no mercy to a senior judge caught in a compromised position.

HOW CITIZENS UNITED LEGALISED CORRUPTION

One of the most significant pieces of legislation that opened the doors to political corruption was the Supreme Court’s passage of Citizens United. This allows corporations to contribute to political campaigns as ‘persons,’ with the privilege to hide their identities and amount of contribution. Political corruption has thus become institutionalised. Private individuals now form super PACs (Political Action Committees) that amass massive amounts of money to influence campaigns. However clean a politician may try to be, it becomes too easy to use this platform. The funding of a candidate by Wall Street to the tune of undisclosed millions has been at the centre of a number of presidential campaigns, with Senator Bernie Sanders leading the charge against those who benefit from Citizens United.

It was also Secretary Clinton’s close association with big money and undisclosed Wall Street associations that became a major hurdle for her campaign. With a Republican now in office, this piece of legislation is unlikely to go anywhere as it would at the very least require a Democratic-leaning Supreme Court to reverse it. America is likely to continue growing its plutocratic regimes for years to come.

The corruption of political influence has also built a powerful corridor between K-Street and Capitol Hill. Corporations and powerful interest groups contract Washington DC lobbyists who buy favour with Congress members in exchange for their Congressional votes to support legislation friendly to the corporations. Issue campaigns such as voting on the environment, for example, are heavily influence by lobbyists who are contracted by private companies to ensure the environmental laws stay or change in the corporation’s favour.

One of the most famous cases of lobbying corruption is the Jack Abramoff case. Abramoff was a top lobbyist whose prowess in bribing members of Congress and Senators on behalf of his clients led him to declare in an interview with RT news that ‘corruption is legal in Washington.’ He admitted that getting jail time for scamming his clients is what led him to a public mea culpa. Much like most who engage in big-money political corruption, the only thing that stops them is getting caught.

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When it comes to legislation that widened the wealth gap by miles, perhaps the reversal of the Glass-Steagall Act in 1999 carries the greatest impact. This was legislation that was passed during the Great Depression to separate ordinary banking from investment banking. It allowed for the common person’s money in the bank to stay safe from the greed of banks. In a spree of deregulation, Glass-Steagall was repealed after over 60 years. It allowed banks to invest people’s money with abandon. The greed level spiked when banks suddenly found themselves with piles of money to play with. Those in the financial sector took greater risks that enriched them and passed on the losses to unsuspecting investors. Products such as the sub-prime mortgages were pushed on uncreditworthy Americans whose dream of home ownership was suddenly packaged as achievable.

The wave of homelessness and decline from middle-class to welfare nation came swiftly when many could not afford to service their rising mortgages. The pain of many families was private and enormous. Others were victims of Ponzi schemes that promised good returns on retirement investments that families had saved up for for a lifetime. As hundreds of thousands of houses were foreclosed on and lifetime savings disappeared, a small percentage of white-collar corporate thieves made off with millions in profits. Some were recycled right back into government, reminiscent of the Kenyan saying: ‘nyani ni wale wale’ (it’s the same monkeys). Greedy banks were bailed out because they were seen as too big to fail.

US wars: Profits in dollars, costs in human lives

As a superpower, America has had the strategic ability to make other countries sites for major corruption schemes through war profiteering. In many ways, the war against terrorism has been one such scheme. In the past 15 years, the invasions of Afghanistan and Iraq have made massive profits for American corporations that got contracts to rebuild those countries following the destruction of their infrastructure by American bombs. Construction firms such as Houston-based KBR Inc won contracts worth billions of dollars. The Costs of War Project run by Brown University’s Watson Institute for International Studies noted that the war in Iraq cost $1.7 trillion, a good amount of which went into private pockets. The famous General Smedley Butler, who saw the true nature of war, wrote in his book, War Is a Racket: “War… is easily the most profitable, surely the most vicious… the only one in which the profits are reckoned in dollars and the losses in lives. It is conducted for the benefit of the very few, at the expense of the very many. Out of war a few people make huge fortunes.”

As hundreds of thousands of houses were foreclosed on and lifetime savings disappeared as a a result of the subprime crisis, a small percentage of white-collar corporate thieves made off with millions in profits. Some were recycled right back into government, reminiscent of the Kenyan saying: ‘nyani ni wale wale’ (it’s the same monkeys)

Building standing armies for sovereign countries that are connected to an accountable international system of laws such as the Geneva Convention is necessary. War profiteering is not necessary; it is simply strategised corruption carried out in someone else’s sovereign state.

How does America deal with major corporate corruption and war profiteering? By the organised uprising of protest voices that build up enough force to demand a change of guard in Washington that will usher in new policies. When such an uprising, however extensive, lacks political organisation, it tapers off. This was the case with Occupy Wall Street movement that targeted corporate corruption. The Wall Street corporations that scammed the people are now richer than ever.

Corruption is a heartless beast. While many get away with it, some do not. Perhaps it is this evidence of the moral universe moving towards justice, however slowly, that keeps American society from imploding under the weight of grand corruption.

By Mkawasi Mcharo Hall
Ms Hall is a freelance writer based in the USA