CORRUPTION - THE CONSEQUENCES ON THE ECONOMY SOCIETY SECURITY Slides for a seminar session and discussion © Denis Osborne, 2007
Ethics and Good Governance 2 DAMAGE TO THE ECONOMY OFTEN UNDERESTIMATED: corruption causes greater costs (to government, companies) Because competition made ineffective (Milan, bribes 2 – 3%, ‘clean hands’ ‘op’ brought costs down 15 – 60%. Where had money gone?) lost revenues (in some countries 50%) those who pay gain more than those who receive, a ‘thought experiment’… policies distorted; investment diverted EVERYBODY SUFFERS
Ethics and Good Governance 3 DAMAGE TO SOCIETY CORRUPTION causes most hurt to minorities, women, and the poor, increasing poverty cannot afford bribes, even ‘relief’ gets diverted causes people to lose trust in each other in the workplace, in families and in government, politics, democracy leads to anger, frustration, conflict SOCIETY DISINTEGRATES
Ethics and Good Governance 4 DAMAGE TO SECURITY Less protection: regulations ignored, risks to food, health, environment, roads, workplaces … Nobody is safe if a bribe gets me a driving licence when I cannot drive well, your children are at risk! More crime: drugs, rape, murder, terrorism, etc criminals are safe if police take bribes People live in fear CORRUPTION KILLS
Ethics and Good Governance 5 CITIZENS’ CONCERNS Not convinced about hurt to economy! Damage understated, but importance over-rated? ‘Corrupt’ countries (and companies) do well. More concerned about loss of trust, conflict risks in family, workplace, government Most concerned about crime, lost safety Perhaps emphasis on economic losses because funds to fight corruption come from Ministries of Finance, World Bank and anti-corruption bodies want the cash
Ethics and Good Governance 6 A GLOBAL THREAT Safety put at risk from money-laundering, drug-running, gun-smuggling, people trafficking, environmental damage, incompetent managers, terrorist acts, GM and other experiments CORRUPTION ANYWHERE THREATENS EVERYBODY EVERYWHERE