June 04, 2004

how to corrupt a democracy

Vladimiro Montesinos was president Fujimori of Peru's security advisor, and as security advisor his job largely consisted of bribing the judiciary, opposition parties, broadcast media - in fact pretty much anyone. that and running the narcotics industry and maintaining a regime of murder. unusually he kept detailed records and transcripts of all his transactions and using these John McMillan & Pablo Zoido of Stanford have compared the amounts of monies paid to different types of interests to see where you really need to spend your money to corrupt democracy.

"We use the bribe prices to quantify the checks and balances. The size of the bribes indicates how much Montesinos had to pay to buy off those who could have checked his power. The typical bribe paid to a television-channel owner was about a hundred times larger than that paid to a politician, which was somewhat higher than that paid to a judge. One single television channel’s bribe was five times larger than the total of the opposition politicians’ bribes. The strongest of the checks and balances on the Peruvian government’s power, by Montesinos’s revealed preference, was television."

one of the better side effects of globalised movement and reporting is that maintaining an authoritarian regime purely with repression is significantly more difficult, at least where a semi-functioning representative system is existent. what the Stanford paper reveals is what parts of an interlocking system of checks and balances it is most necessary to control. the largest single outlay, and hence, in this analysis, the most important of the interlocking controls on corruption turns out to be control of television networks. of which Montesinos exlcuded only a single television station whos monthly subscriptions that precluded much of the population viewing it. it was this same basis of smaller media that made him unconcerned with smaller scale broadsheets rather than the mass circulation tabloids.

"How much did Montesinos pay in total? The cost of bribing the politicians to get a majority in Congress added up to less than $300,000 per month. The total cost of bribing judges (at a rough guess, because we do not have complete data for judges) was $250,000 per month. The total cost of bribing the television channels was more than $3 million per month. Television was the priciest of the checks by an order of magnitude."

equally worrying were the techniques used outside of bribery. significant amounts of paid propaganda were aired on the television networks, communicating the governments message, against a background of a continued war against terrorism (in this case the shining path guerrillas) and the defamation of journalists who remained outside the system of bribery and blackmail run by Montesinos on behalf of Fujimori - often accusing them of being 'like terrorists'.

where the paper is most fascinating, and revealing even for largely non-corrupt representative systems is why television was the most expensive outlay. essentially they have more bargaining power, they all need to be brought out (as one remaining may still wield influence) so the can operate as a cartel. the economies of scale for already extraordinarily rich media barons are much higher. but most importantly the ultimate check on any corrupt regime is the mass of the people and it is television that is most able to help mobilise large scale popular dismay at political corruption.

"The ultimate constraint on any democratic government is not an independent judiciary or opposition politicians or the constitution: it is the citizenry as a whole. The citizens have a stake in ensuring that the government maintains the institutions of democracy. If a large number are able to react to any government violation of the rules, they effectively pre-empt such violations. The citizens’ credible threat to depose the government makes the constitution self-enforcing. As Weingast (1997) points out, however, they face a coordination problem in establishing the rule of law. They are effective in concert, not alone. As in any coordination game, any one citizen’s best action depends on what she believes the others will do. It pays her to react to the government’s violation only if she expects that many others will react too. Although in Weingast’s analysis the coordination problem is exacerbated by differences in interests among the citizens, a prior source of coordination difficulties is a lack of information."

it was in the end the un-brought channel that brought Fujimori down, broadcasting over and over again a carefully recoded video tape of Montesinos bribing a congressman. what the report concludes is that the honesty and independence of legislation and judiciary are critical, and most likely to remain so in countries with a level of wealth over $10000 per captia. and that corruption itself is part of a circle that lowers wealth hence making a slide from democracy to autocracy more likely. but most tellingly that the single most important of all of the factors in a functioning and honest democracy is the freedom of the press.

"That the news media are the chief watchdog has implications for policy. The checks and balances work as a system, so an independent judiciary and genuine political competition are needed. But measures to safeguard the media’s independence from political influence and to ensure their credibility to the public are perhaps the crucial policies for shoring up democracy."

full paper here

Posted by flambingo at June 4, 2004 04:46 PM | TrackBack
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