The cost of corruption

Some opposition members love to tell the story of a meeting they had abroad with foreign investors. The foreigners wanted to know why they had been asked by the Philippine government to pad the price of a major infrastructure project.

There was a translator, so the stunned opposition members asked for a second translation, thinking there might have been a mistake. Words were exchanged and the same question was posed by the foreigners. Nothing lost in translation.

This story, of course, could be nothing but opposition propaganda, and I’m quite sure that if grilled, those foreigners would never admit that they raised the issue of overpricing.

But the typical reaction of most Filipinos who hear the story will likely be, "So what else is new?"

It’s not just projects of the national government that are often overpriced. A recent story involves a local government executive who allegedly told a contractor to jack up the price of streetlights by 400 percent.

Who pays for overpriced deals? Juan de la Cruz, of course. Taxpayers should get mad. Taxpayers should get even. Not by withholding tax payments, but by helping catch, prosecute and send the corrupt to prison.

The level of corruption in the Philippines has barely gone down since the Marcos dictatorship because people can see that thieves can take the money and run. It’s sad but true, that if you’re going to steal in this country, you better steal big-time, because then you have a bigger chance of getting away with it.

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A Gallup 2005 survey commissioned by anti-graft watchdog Transparency International defines corruption as the abuse of entrusted power for personal gain. If that definition were strictly followed, all Philippine public officials plus certain business leaders will be included in the sleazebag’s annual Who’s Who.

For Filipinos, the surest paths to fame and fortune are politics and entertainment. In other countries, individuals who leave high-paying jobs in the private sector to join the government are deemed to be making a sacrifice. In our country, the move is seen as a way of making even bigger money.

A public servant is an oxymoron in the Philippines. Our public officials serve themselves first, plus their relatives and friends, before thinking, if at all, of the public good.

We are often warned that corruption aggravates poverty, drives away investments and hobbles development. We are often reminded that the world’s most prosperous economies are also the least corrupt, or are seen to be exerting a strong effort to put graft under control.

Yet corruption thrives in our country, afflicting pro-administration and opposition politicians alike.

Honest taxpayers are victimized twice over — first when their money is spent on overpriced projects, and second when bribery costs are factored into project expenditures and passed on to the public in the form of higher toll rates, for example, or other fees.

Those who don’t earn enough to be subject to taxation are the worst victims. Public funds that are wasted on overpriced projects mean less funds for basic services such as education and health care — services that have already deteriorated so much in recent years.

Previous studies have shown that billions of pesos have been lost to corruption in the past years. Those billions could have been used instead to increase the salaries of government doctors, nurses and teachers so they need not join the alarming exodus of professionals.

Those billions could have been used to hire more cops to make the streets safer, or increase cops’ pay to reduce the temptation of corruption. The money could have been used to raise the salaries of soldiers and buy more basic military equipment such as naval patrol vessels and aircraft so we need not keep approaching Washington with a begging bowl for hand-me-downs.

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Last week, as the United Nations marked International Anti-Corruption Day, the Political and Economic Risk Consultancy released the results of its survey among foreign executives in Asia, which rated the Philippines as the third most corrupt in this part of the world.

The top executives who were polled said that the cheaper cost of doing business in developing countries was trumped by the ease and predictability of investing in places where there is transparency, and where clean legal and judicial systems allowed victims of corruption to seek redress.

In our country, corruption and inefficiency plague even the judiciary, law enforcement agencies and business regulatory bodies. Reforms come slowly even in the legislature, where the pork barrel system has become an immense source of kickbacks even for minor projects such as road repairs.

Investors who lament the cost of corruption find themselves in a situation of take it or leave it. The few who tried to take their complaints to Philippine courts have learned that in this country, justice and the law are entirely different creatures.

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The Gallup poll of corruption in 69 countries reportedly showed some optimism that graft would decline within the next three years in some parts of the world.

"Like a bad disease, corruption is often predictable, preventable and curable," David Nussbaum, chief executive of Transparency International was quoted as saying. "The world is turning against the corrupt."

Filipinos are also trying to turn against the corrupt, but the problem of graft is so deeply entrenched in our culture that no one is sure where to start.

When those investigating the corrupt are themselves tainted, the moral high ground that is necessary for a successful campaign against venal public officials is lost. We are seeing this now in the latest political scandals, where despairing Filipinos are simply waiting for the protagonists to kill each other.

There’s no lack of public awareness of what ails the country. There’s no lack of laws either; we have turned large-scale corruption — involving amounts of P50 million or more — into a capital offense.

What’s lacking is the enforcement of laws. This is a failure of the criminal justice system. We arrested and held without bail a deposed president for plunder, and now we don’t know what to do with him. No member of the Marcos clan has been convicted of any crime.

Retired Army Maj. Gen. Carlos Garcia at least has been convicted and sentenced to two years, but that was military justice, for violation of the Articles of War. The plunder charge against him in civilian courts is bound to drag on like Estrada’s case.

Until we can show that corruption does not pay, there will never be a deterrent to graft.