Monday, September 12, 2011
On Public Corruption in India
By Namit Arora
Public corruption is often defined as the misuse of public office for private gain. It tends to thrive when discretionary power is vested in officials amid a weak architecture of deterrence. A persistent feature of all societies, public corruption is today considered a problem of the developing world. Examples include politicians, bureaucrats, and other officials taking bribes to influence outcomes in business licensing, awarding contracts, registering property, citing traffic violations, disbursing education funds, and so on.
The stakes rise dramatically with neoliberal reforms, when the state begins to transfer public assets to private firms—such as land, mines, and airwaves—usually under weak regulatory, supervisory, and legal frameworks. For instance, the big Bofors scandal of pre-reforms India of the 1980s involved $25 M, whereas the 2G telecom scam last year may have cost the exchequer $39 B. It is said that as developing countries turn into developed nations, bribery turns into another means of influence: lobbying.
It is widely believed that public corruption hurts macroeconomic growth. However, research on the impact of corruption on growth is not conclusive. China, among the most corrupt countries, has one of the highest growth rates. Perhaps China's GDP would have grown even faster without corruption, but that's a conjecture; theoretical explanations for China cut both ways. Some researchers now favor the view that the impact of corruption on macroeconomic growth depends on the nature of the regime and the kind of corruption there is. Some kinds can align in favor of growth, others against. Corruption of course has wider implications beyond growth. Various studies have shown its adverse impact in the microeconomic realm. Higher corruption reduces entrepreneurial activity, allocates talent less efficiently, and worsens services integral to human development. Finally, public corruption also eats away at social institutions, undermines the rule of law, erodes social trust, and can jeopardize public safety and hurt the environment.
It seems to me that most fights against public corruption, including in India, strive to make the system function "as advertised". They strive for transparency and accountability in the system. They tend not to challenge the rigged rules of the system itself, including the investment priorities of the country, or its response to socioeconomic disparities. But this is not necessarily a shortcoming. Tactical prudence may require such focus, and these latter concerns, related and complementary in nature, may sometimes be best left to other concerned citizens.
Reducing corruption, to be clear, may do nothing for equitable distribution—unless significant redistributive programs and safety nets already exist in a country. Indeed, in such cases, the clearest adverse impact of corruption occurs in the delivery of social services to the marginalized—food, schooling, medicine, employment assistance, etc. The more programs for socioeconomic justice that exist in a country, the bigger the obstacle that corruption poses for their delivery. This then is the context in which a fight against public corruption is also a promoter of socioeconomic justice, even if as a byproduct. The big question then becomes: how does one go about reducing corruption, especially in India?
The Idea of the Lokpal
Anti-corruption activists in India have since 1968 agitated for a Lokpal, or office of the ombudsman, authorized to independently investigate and prosecute cases of public corruption. It aims to avoid conflicts of interest that stymie self-policing within public institutions. It is basically a good idea, and should be an important pillar in a larger architecture of deterrence. But as always, the devil lurks in the details. Many developing countries have tried this experiment with decidedly mixed results. Several lessons emerge from their experiences. Here, for instance, is an extract from a recent comparative study on Indonesia vs. Phillippines:
Anti-corruption agencies have long been a principal strategy to fight corruption in many developing countries. Unfortunately, few of them have produced evident results and they are seen as being rather ineffective. Recently, however, the Corruption Eradication Commission of Indonesia (KPK) seems to have emerged as an exception. Can this success be substantiated and, if so, how can it be explained?
A comparison with another such institution in a very similar neighbouring country — the Office of the Ombudsman of the Philippines — illustrates the KPK’s success especially in investigating and prosecuting corrupt public officials. Why was the KPK, in just five years, able to reach a 100% conviction rate against top officials in all major branches of the Indonesian government, while the Philippine Ombudsman has scored only few convictions in its 20-year history? Part of this success can be explained by considerable investigative powers given to KPK, which the Philippine Ombudsman does not hold. Also, rigorous pre-testing of every prosecution and a highly efficient anti-corruption court contribute to KPK’s success.
Hong Kong and Singapore too reduced their public corruption in part by establishing "an independent anticorruption agency with widespread powers". Hong Kong went further, instituting "legal precedents such as 'guilty until proven innocent'" (not necessarily an example to follow). Notably, granting independence and prosecutory power to anti-corruption agencies is not enough; it hasn't prevented such agencies from being used in many other countries "as an instrument of repression against political opponents, not to fight corruption." It has even led some agencies, as in Hong Kong, to thwart investigations into their own doings. In both Hong Kong and Singapore, parallel reforms like higher payscales, job rotation, rewards to public officials for honesty and reporting wrongdoers, simplifying rules and permits, publishing roles and procedures, and strong support for anti-corruption efforts from the top were crucial for success. Clearly, there are many pillars in a credible architecture of deterrence—not just tough policing. One might also add technological solutions that help bypass layers of bureaucracy, making it harder to embezzle money by creating digital audit trails, and so on. The question for India then becomes: which coctail of approaches is likely to be most effective?
Indians have lately seen many high-profile cases of corruption. Many saw the 2010 Commonwealth Games scam as tarnishing India's global image and they were incensed by it. Some heckled the games' chairman in the closing ceremony. Other scams followed; news came out that the largest depositors of black money in Swiss accounts are Indian. In this climate, a clutch of seasoned social activists turned up the heat by channeling this anger. Once again—with previous attempts having died on the vine—the government agreed to introduce a Lokpal bill. Many proposals on how to institute this office were floated, including one authored by the government itself and memorably derided as "jokepal". One that has gained the most traction is the Jan Lokpal (JLP) bill, associated with the self-styled Gandhian, Anna Hazare, and his team—Arvind Kejriwal, Prashant Bhushan, Kiran Bedi, and others—under the banner of "India Against Corruption".
But how do the Indians agree on a good anti-corruption bill, then get their parliamentarians to pass it? It's not in the latter's interest, is it? So many of them are steeped in corruption. Only two routes exist for passing such a bill: via a formal public referendum, or via intense public pressure on politicians. Since India does not have the former, public pressure remains the only approach—the one adopted by Team Anna.
What is the Jan Lokpal Bill?
The JLP bill proposes to create a single independent agency to investigate allegations of public corruption all across India in accordance with the Prevention of Corruption Act 1988. It'll incorporate the currently defanged anti-corruption units of existing agencies, like the CBI and CVC. The agency will have eleven appointed members, all "eminent individuals", chosen by a search and a selection committee. It will have lots of investigators and support staff. Investigators will have the powers vested in police officers, and will also be able to wiretap any suspect's phone and internet lines (utilizing a 2008 amendment to the Information Technology Act 2000, which, incidentally, has been criticized for lacking adequate "legal and procedural safeguards to prevent violation of civil liberties").
Any citizen can file a complaint of corruption against any government employee through an FIR. Following investigations, the Lokpal can fine, demote, or fire government employees from their jobs. It will prosecute them in special courts established within the existing judicial system (more courts can be created based on demand) and all trials have to be completed within 12 months. It will even go after their personal assets to recover the embezzled monies. Whistle-blowers are protected but frivolous or vindictive complaints are punishable by a fine.
Alongside the independence and prosecutory power vested in the Lokpal, the bill has some provisions to thwart abuses of power. Whether on not they are adequate is I think debatable. The Lokpal's and the special court's decisions can be legally challenged, though, for no good reason, this has been made far more onerous than for other civil and criminal cases. For transparency, the Lokpal will post each month the full records of completed investigations on the web, cases opened and closed, and minutes of board meetings. An Independent Complaints Authority with multiple offices, each comprised of five appointed "eminent individuals", would hear complaints against corrupt Lokpal officials and remove them if necessary, but the Lokpal's eleven members can be removed only by the Supreme Court.
Employment quotas, much as in other government bodies, will exist at the investigator and staff level, but not among its top echelon or in the search and selection committees. And while much of the focus is on policing, the bill also requires additional reforms—a subset of those in Hong Kong and Singapore—to increase the odds of its success against corruption. For instance, it requires all public offices to publish a citizen's charter defining roles, responsibilities, and procedures, as well as a grievance redressal system. However, the entire focus of the bill is on the conduct of the public servant, and none at all on the "demand side" of the market, that is, on the role of ordinary citizens and businesses in creating incentives for public corruption. To tackle public corruption in state governments, each state will have a similar ombudsman agency too, called the Lokayukta.
On the Bill and the Movement
(Full disclosure: The architect of the JLP bill, Arvind Kejriwal, is a friend from college; we were batchmates and lived in the same hostel for four years. We have met many times since, especially during my two years in India, 2004-6, and I saw him lead a movement against a World Bank backed initiative for privatizing water distribution in Delhi. I then moved back to California and our contact diminished, but I'm in touch with friends who see him often. In recent years, I have come to admire his personal integrity, courage, and dedication to bringing transparency and accountability to governance.)
The current version of the JLP bill has come a long way. Earlier versions had some surprisingly amateurish and illiberal ideas in it—not from malice, I am convinced, but from noble intentions. For instance, in order "to ensure swift and certain punishment" for public servants, the JLP bill proposed to vest the Lokpal with the power of both police officer and judge. The Lokpal could not only run its own investigations and conduct its own trials but the bill wanted that "no proceedings or decisions of the Lokpal shall be liable to be challenged, reviewed, quashed, or called in question in any court of ordinary Civil Jurisdiction." Isn't that taking away a public servant's constitutional right to appeal his unfair dismissal or guilty verdict? It also sugested that the Lokpal would check the government's "recklessness in decision-making", without defining "recklessness" and making one wonder what need remained for an elected executive.
Not surprisingly, hackles were raised about the "hidden agenda" of its authors, and its real (and imaginary) violations of the constitution and representative democracy. For many, the trust remains irrevocably broken. But the bill has moved on and I don't understand how the current version of the JLP bill, though still not ready for prime time, subverts the constitution, as some continue to confidently assert. I'm no constitutional scholar, and I solicit arguments (or pointers) from readers who can tell me how.
Another persistent complaint is that the current bill, as well as Team Anna's tactics, subvert representative democracy. Anna's televised hunger strike—which, as a friend quipped, has a curious power in a country where so many are allowed to go hungry each night—was seen as using coercive tactics. What if tomorrow someone else began fasting to abolish reservations? Didn't Team Anna come across as too combative in demanding that the parliament pass their own bill without debate? Is this not an undermining of representative democracy?
Some say the answer is "yes", but there is another way to look at it. Anna's fasting drama, it seems to me from knowing Arvind, was a populist pressure tactic of last resort—well within their democratic rights—to get the politicians to tackle corruption seriously, something that representative democracy arguably cannot deliver at this time. Arvind is all about empowering the citizen, as evidenced by his stellar activism on Right to Information. He may well argue that the JLP bill will help realize a better democracy, that it will empower ordinary citizens to report their victimization by public corruption via an FIR, just as citizens now do for other crimes. It will also accelerate the dispensing of justice, for justice delayed is often justice denied. Indeed, both Arvind and Bhushan want India to embrace certain forms of direct democracy, such as referendums—which may eventually diminish the influence of the urban middle-class, so central to this anti-corruption movement.
Which brings me to Team Anna's claim that theirs is a people's bill and it speaks for much of India, even when the bill has been challenged by many leaders of Dalit, OBC, Muslim, and other minorities' organizations, who claim to represent 85% of the Indian polity. Team Anna says they have incorporated the best feedback on the bill after public consultations over many months. But they were the sole arbiters of what "best feedback" means. Is it conceivable that the "people of India" were opposed to caste- or gender-based reservations among the eleven members of the Lokpal, its search and selection committees, and the Independent Complaints Authority? Indeed, reservations are especially important in a powerful policing and prosecuting agency to improve its sensitivity to all Indians, and to minimize the odds of discrimination—a problem that's rife in law enforcement today (and not just there). Citing the Election Commission to deflect the issue of reservations only strengthens those who say that Team Anna does not see the point of reservations, that they hold an outmoded view of "merit", that they are actively anti-reservation, that the Lokpal will disproportionately target low-caste people and minorities—a legitimate viewpoint in which the Lokpal seems opposed to the progressive spirit of the Indian constitution. The bigger problem, some social classes might say, is not the absence of laws or punishment, but their very biased application. So why not make the Lokpal inclusive and reflective of the entire Indian polity, something Ambedkar might have supported himself? Else, if there are good arguments against reservations in the agenda-setting echelons and the accountability layer of the Lokpal, let's hear them!
Further, it's worth noting that this anti-corruption movement is not exactly an endorsement of the JLP bill itself—few of its supporters understand its details. It is more a howl against public corruption, fueled by the people's yearning for "judicial salvation" from a genuine problem and the government's atrocious response to peaceful protests. For all its commendable success in raising awareness and bravely forcing a major issue on the table, Team Anna has also tainted itself though its proximity, even if out of expedience, with Hindu nationalists and their symbols and slogans. Then there is Anna's very problematic leadership, illiberal politics, and authoritarian ways. This "simple man" and "Gandhian" figure has advocated chopping the hands of the corrupt, even hanging them, and has expressed support for executions on public squares. His views on Dalits in his village are retrograde (how much longer, I wonder, before he becomes a liability for Team Anna?).
All of which has diminished this "people's movement", made it less inclusive, and pushed the wrong buttons for many engaged citizens. Its 24x7 television coverage brought to mind the Mandal era of urban middle-class and right-wing rallies against reservations, led by a media that still routinely ignores progressive social protests beyond urban middle-class concerns. But this conflation seems to me tragic, for it has also obscured for many the movement's wider support base and the progressive goal at its core.
One of the great benefits of anti-corruption movements like this is to subliminally convey to all citizens that corruption is uncool. By forcing a debate, they help raise the social cost of corrupt behavior. Such inner transformation is a cornerstone in the architecture of deterrence. But enforcing the rule of law is necessary too, and more than ever, the time for a strong, sensible, and inclusive Lokpal bill is now.
More writing by Namit Arora?
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Posted by Namit Arora at 12:45 AM | Permalink