Yes, you’re right, I realize I was rather thin on evidence for the link between institutional weakness and corruption. I believe this was like mind fallacy on my end, I assumed the link was obvious. But since clearly it was not allow me to go back and contextualize it.
Disclaimer: It’s late and I’m tired, prose quality will be lower than usual, and I’ll be prone to some rather dry political jokes.
To understand the link between institutions and corruption, I think it’s helpful just to use simple mental models. Consider this simple question: what causes corruption? The answer seems fairly straightforward. People are corrupt, they want money, etc etc. But clearly, this isn’t everything. Humans in different countries coming from similar racial, social, and class backgrounds tend to be varying levels of ‘corrupt’, but even countries with similar backgrounds often have wildly varying corruption levels. Take North and South Korea, for one example. Both were unified states emerging from occupation post WWII, but they took wildly different paths in their development as countries.
South Korea eventually transitioned from a military dictatorship to a free market democracy who know today. North Korea, however, remained a military dictatorship. This resulted in stark differences in corruption handling on both sides. In the global corruptions perceptions index, South Korea ranks 31st, while North Korea ranks an appalling 171st. Why was this?
The answer, I think, is institutions. South Korea, having developed a free market system and accountable mode of governance, is able to check the power of it’s political and economic elites. If the president of North Korea decides he wants to abuse his power, the people have no recourse. If the president of South Korea decides to abuse their power, they end up in prison. (See the 7 korean heads of state that ended up in jail, quite impressive for a 40 year period. We had 4 years with Trump and only managed a mugshot.)
Memes aside, strong institutions typically have a variety of methods to align their leaders with the needs of the people and stave off corruption. Understanding that those in power tend to abuse said power unless restricted in some way, most democracies have institutions in place to ensure no one person dominates the system. Typically, the most straightforward answer is elections. In democracies, a leader can be corrupt to the extent the public tolerates it. Be too corrupt and you end up losing elections, or serving prison time (cough cough South Korea). There is also much greater public oversight and freedom of information, which creates a drive towards transparency. If the CCP is corrupt there’s no real way to hold them accountable. The secret police will arrive to have a word with you. Xi Jinping can do as he likes and nobody has a say about it. If the American president tried to do the same we would see the news awash with headlines of scandal. The other political party would cackle, and voters would scramble to find a more reliable candidate.
These mechanisms of alignment, as I’d call them, are far from perfect. Even in liberal democracies like the US it’s common knowledge most congressmen are multi millionaires, and for individuals with modest state salaries they sure have an uncanny knack for obtaining huge sums of wealth. (Perhaps Pelosi should give day trading a try, she sure seems to have talent) However, the fact remains that corruption tends to be discouraged as a general rule, and instances of corruption tend to be far less overt and damaging. We don’t see, for instance, the head of state winning a state run lottery. Or Congress passing themselves a 10 billion dollar pay raise. Backroom deals, cushy corporate jobs, insider trader and the like are acceptable. Outright raising land rents like a feudal lord to fund direct salary increases is not. Our leaders are, in the end, constrained by law. This allows regular citizens to do the work of making money… mostly. Corruption will hurt, but it isn’t crippling as there’s at least some accountability.
Case in point, many of the worst offenders are simply convicted of federal corruption charges. Our last president was impeached twice and is currently on trial for, among other things, fraud and corruption. Imperfect as they are, these are still methods to keep the guy in charge accountable. This does not exist in countries with weak institutions. Many times, in fact, the institutions end up bolstering corruption.
Let’s return to the example of Mexico. Recall how Carlos Slim was able to build a tele-networking monopoly to plunder the wealth of the people. You might wonder how in the world he managed this, surely the law wouldn’t stand for such overtly criminal business practices? The issue is, not too surprisingly, that the law is on Slim’s side. Recurso de Amparo, originally a law designed to protect the constitutional rights of citizens, has been exploited by Slim’s lawyers to shield his business practices. See how Slim was able to dodge a record fine. This was the very same law Slim attempted to fall back on when he attempted his monopolistic practices in the US, only it didn’t exist. American law, in it’s infinite magnanimity to the rich and powerful, still managed to slap Carlos Slim with a fines for his comparatively much more minor transgressions. The tactics which Slim used to succeed in Mexico failed utterly in the US. Mostly if not completely due to the nature of the US’ institutions. For all it’s faults, the modern US is no longer in the gilded age. Overt monopolies are no longer allowed.
It’s not just that weak institutions favor the businesses of oligarchs either. Weak institutions actively give businesses to oligarchs. Consider post Soviet Russia, which saw previously state owned companies auctioned off to political cronies at bargain prices. Or post Soviet Hungary, which likewise handed billions to unscrupulous businessmen willing to play political games of power. Slim himself was an example of such a politically created oligarch in Mexico, having acquired his telecommunications company with shady backroom deals. Lacking any oversight, corrupt government officials stole like there was no tomorrow, happily selling the public good for private benefit. These are the structures who create men like Carlos Slim, Sandor Csyani, and Sergei Shoigu. All of whom received their wealth, not through aptitude, service, or innovation, but rather, political machinations.
How is the normal businessman meant to succeed, in an environment like this? The question is rhetorical. Of course they don’t. You do not compete with Carlos Slim’s megacorporation in Mexico. You do not attempt to create rival banks against Sandor Csyani in Hungary. You don’t invest in quality as a Russian procurement company, you invest in another mansion for Sergei Shoigu. In all examples listed we see the same problem. People will be corrupt if there is no institutional safeguards, much like they would commit crimes if there was no police force. Being corrupt, they naturally move to stifle free market competition and forcibly seize the assets of anyone who is successful but lacks a powerful political patron. There is no point in trying. There is no point in innovating. There is no point in trying to create jobs or lift people out of poverty. Now, playing politics and kissing the Supreme leader’s arse? That’s where the money is.
Having said all this, we find ourselves full circle back where we started, once again at institutions. As I illustrate, much of the problem with corruption (and yes, this applies to war also) is essentially an alignment issue between the ruler and ruled. The ruler(s) doesn’t need to care about their subjects, because they’re the damn ruler, they can do whatever they like. Corruption can leave schools underfunded and famine relief nonexistent. Wars can devastate families and tear lives to pieces. But the almighty Shepard cares nothing for the suffering of his sheep. Why should he? There is, after all, nothing stopping him.
I hope this was a coherent narrative to your satisfaction. Feel free to ask for elaboration or provide critiques. I’ll apologize in advance for the poor quality, but it’s late on a school night so I’ll have to get going. Hope you enjoyed, and look forward to your response!
I waited Friday so that you won’t sleep at school because of me, but yes I enjoyed both style and freshness of ideas!
Look, I think you’re a young & promising opinion writer, but if you stay on LW I would expect you’ll get beaten by the cool kids (for lack of systematic engagement with both spirit and logical details of the answers you get). What about finding some place more about social visions and less about pure logic? Send me where and I’ll join for more about the strengths and some pitfalls maybe.
You’re probably right. I mainly started on lesswrong because this is a community I’m familiar with, and a place I can expect to understand basic norms. (I’ve read the sequences and have some understanding of rationalist discourse). I’m unsure how I’d fare in other communities, but then, I haven’t looked either. Are you familiar with any? I don’t know myself.
Likely a good suggestion. I’m in a few communities myself. But then, I’m unsure if you’re familiar with how discord works. Discord is primarily a messaging app with public server features tacked on. Not the sort of community for posts like this. Are you aware of any particular communities within discord I could join? The general platform has many communities, much like reddit, but I’m not aware of any similar to lesswrong.
Nope, my social media presence is very very low. But I’m open to suggestion since I realized there’s a lot of toxic characters with high status here. Did you try EA forums? Is it better?
Hm… pretty similar here. I also don’t have much of a media presence. I haven’t tried EA forums yet, mainly because I consider myself intellectually more aligned with LW, but in any case I’m open to looking. This is looking to be a more personal conversation now. Would you like to continue in direct messages? Open to hearing your suggestions, I’m just as clueless right now.
Thanks for your reply!
Yes, you’re right, I realize I was rather thin on evidence for the link between institutional weakness and corruption. I believe this was like mind fallacy on my end, I assumed the link was obvious. But since clearly it was not allow me to go back and contextualize it.
Disclaimer: It’s late and I’m tired, prose quality will be lower than usual, and I’ll be prone to some rather dry political jokes.
To understand the link between institutions and corruption, I think it’s helpful just to use simple mental models. Consider this simple question: what causes corruption? The answer seems fairly straightforward. People are corrupt, they want money, etc etc. But clearly, this isn’t everything. Humans in different countries coming from similar racial, social, and class backgrounds tend to be varying levels of ‘corrupt’, but even countries with similar backgrounds often have wildly varying corruption levels. Take North and South Korea, for one example. Both were unified states emerging from occupation post WWII, but they took wildly different paths in their development as countries.
South Korea eventually transitioned from a military dictatorship to a free market democracy who know today. North Korea, however, remained a military dictatorship. This resulted in stark differences in corruption handling on both sides. In the global corruptions perceptions index, South Korea ranks 31st, while North Korea ranks an appalling 171st. Why was this?
The answer, I think, is institutions. South Korea, having developed a free market system and accountable mode of governance, is able to check the power of it’s political and economic elites. If the president of North Korea decides he wants to abuse his power, the people have no recourse. If the president of South Korea decides to abuse their power, they end up in prison. (See the 7 korean heads of state that ended up in jail, quite impressive for a 40 year period. We had 4 years with Trump and only managed a mugshot.)
Memes aside, strong institutions typically have a variety of methods to align their leaders with the needs of the people and stave off corruption. Understanding that those in power tend to abuse said power unless restricted in some way, most democracies have institutions in place to ensure no one person dominates the system. Typically, the most straightforward answer is elections. In democracies, a leader can be corrupt to the extent the public tolerates it. Be too corrupt and you end up losing elections, or serving prison time (cough cough South Korea). There is also much greater public oversight and freedom of information, which creates a drive towards transparency. If the CCP is corrupt there’s no real way to hold them accountable. The secret police will arrive to have a word with you. Xi Jinping can do as he likes and nobody has a say about it. If the American president tried to do the same we would see the news awash with headlines of scandal. The other political party would cackle, and voters would scramble to find a more reliable candidate.
These mechanisms of alignment, as I’d call them, are far from perfect. Even in liberal democracies like the US it’s common knowledge most congressmen are multi millionaires, and for individuals with modest state salaries they sure have an uncanny knack for obtaining huge sums of wealth. (Perhaps Pelosi should give day trading a try, she sure seems to have talent) However, the fact remains that corruption tends to be discouraged as a general rule, and instances of corruption tend to be far less overt and damaging. We don’t see, for instance, the head of state winning a state run lottery. Or Congress passing themselves a 10 billion dollar pay raise. Backroom deals, cushy corporate jobs, insider trader and the like are acceptable. Outright raising land rents like a feudal lord to fund direct salary increases is not. Our leaders are, in the end, constrained by law. This allows regular citizens to do the work of making money… mostly. Corruption will hurt, but it isn’t crippling as there’s at least some accountability.
Case in point, many of the worst offenders are simply convicted of federal corruption charges. Our last president was impeached twice and is currently on trial for, among other things, fraud and corruption. Imperfect as they are, these are still methods to keep the guy in charge accountable. This does not exist in countries with weak institutions. Many times, in fact, the institutions end up bolstering corruption.
Let’s return to the example of Mexico. Recall how Carlos Slim was able to build a tele-networking monopoly to plunder the wealth of the people. You might wonder how in the world he managed this, surely the law wouldn’t stand for such overtly criminal business practices? The issue is, not too surprisingly, that the law is on Slim’s side. Recurso de Amparo, originally a law designed to protect the constitutional rights of citizens, has been exploited by Slim’s lawyers to shield his business practices. See how Slim was able to dodge a record fine. This was the very same law Slim attempted to fall back on when he attempted his monopolistic practices in the US, only it didn’t exist. American law, in it’s infinite magnanimity to the rich and powerful, still managed to slap Carlos Slim with a fines for his comparatively much more minor transgressions. The tactics which Slim used to succeed in Mexico failed utterly in the US. Mostly if not completely due to the nature of the US’ institutions. For all it’s faults, the modern US is no longer in the gilded age. Overt monopolies are no longer allowed.
It’s not just that weak institutions favor the businesses of oligarchs either. Weak institutions actively give businesses to oligarchs. Consider post Soviet Russia, which saw previously state owned companies auctioned off to political cronies at bargain prices. Or post Soviet Hungary, which likewise handed billions to unscrupulous businessmen willing to play political games of power. Slim himself was an example of such a politically created oligarch in Mexico, having acquired his telecommunications company with shady backroom deals. Lacking any oversight, corrupt government officials stole like there was no tomorrow, happily selling the public good for private benefit. These are the structures who create men like Carlos Slim, Sandor Csyani, and Sergei Shoigu. All of whom received their wealth, not through aptitude, service, or innovation, but rather, political machinations.
How is the normal businessman meant to succeed, in an environment like this? The question is rhetorical. Of course they don’t. You do not compete with Carlos Slim’s megacorporation in Mexico. You do not attempt to create rival banks against Sandor Csyani in Hungary. You don’t invest in quality as a Russian procurement company, you invest in another mansion for Sergei Shoigu. In all examples listed we see the same problem. People will be corrupt if there is no institutional safeguards, much like they would commit crimes if there was no police force. Being corrupt, they naturally move to stifle free market competition and forcibly seize the assets of anyone who is successful but lacks a powerful political patron. There is no point in trying. There is no point in innovating. There is no point in trying to create jobs or lift people out of poverty. Now, playing politics and kissing the Supreme leader’s arse? That’s where the money is.
Having said all this, we find ourselves full circle back where we started, once again at institutions. As I illustrate, much of the problem with corruption (and yes, this applies to war also) is essentially an alignment issue between the ruler and ruled. The ruler(s) doesn’t need to care about their subjects, because they’re the damn ruler, they can do whatever they like. Corruption can leave schools underfunded and famine relief nonexistent. Wars can devastate families and tear lives to pieces. But the almighty Shepard cares nothing for the suffering of his sheep. Why should he? There is, after all, nothing stopping him.
I hope this was a coherent narrative to your satisfaction. Feel free to ask for elaboration or provide critiques. I’ll apologize in advance for the poor quality, but it’s late on a school night so I’ll have to get going. Hope you enjoyed, and look forward to your response!
I waited Friday so that you won’t sleep at school because of me, but yes I enjoyed both style and freshness of ideas!
Look, I think you’re a young & promising opinion writer, but if you stay on LW I would expect you’ll get beaten by the cool kids (for lack of systematic engagement with both spirit and logical details of the answers you get). What about finding some place more about social visions and less about pure logic? Send me where and I’ll join for more about the strengths and some pitfalls maybe.
Many thanks for the kind words, I appreciate it.
You’re probably right. I mainly started on lesswrong because this is a community I’m familiar with, and a place I can expect to understand basic norms. (I’ve read the sequences and have some understanding of rationalist discourse). I’m unsure how I’d fare in other communities, but then, I haven’t looked either. Are you familiar with any? I don’t know myself.
Nope, but one of my son suggests discord.
Likely a good suggestion. I’m in a few communities myself. But then, I’m unsure if you’re familiar with how discord works. Discord is primarily a messaging app with public server features tacked on. Not the sort of community for posts like this. Are you aware of any particular communities within discord I could join? The general platform has many communities, much like reddit, but I’m not aware of any similar to lesswrong.
Nope, my social media presence is very very low. But I’m open to suggestion since I realized there’s a lot of toxic characters with high status here. Did you try EA forums? Is it better?
Hm… pretty similar here. I also don’t have much of a media presence. I haven’t tried EA forums yet, mainly because I consider myself intellectually more aligned with LW, but in any case I’m open to looking. This is looking to be a more personal conversation now. Would you like to continue in direct messages? Open to hearing your suggestions, I’m just as clueless right now.