corruption and democratic consolidation in latin america. paper by hector faya rodriguez

8/8/2019 Corruption and Democratic Consolidation in Latin America. Paper by Hector Faya Rodriguez

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GEORGETOWN UNIVERSITY

CENTER FOR LATIN AMERICAN STUDIES

GOVERNMENT DEPARTMENT

POLITICAL CORRUPTION AND

DEMOCRATIC CONSOLIDATION IN LATIN AMERICA

BY

HECTOR FAYA RODRIGUEZ

Final Term Paper

GOVT 387 Transitions to democracy

Professor Eric Langenbacher

Washington, D.C., July 21, 2006

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Political Corruption and Democratic

Consolidation in Latin America

Introduction

Drawing on recent scholarly research, this paper aims to explore the major effects

of corruption on the five partial regimes of which Wolfgang Merkel has considered liberal,

embedded democracies, are made up with. External circumstances will also be studied.

Such analysis will allow us to analytically understand the harmful consequences that

corruption infects on the whole process of democratic consolidation. Much of the political

crisis that most Latin American countries are currently experiencing, it will be argued, is

result of a detachment of such ideal partial regimes with the political, economic, and

cultural reality. The resulting complexities will provide grounding for some conclusions

which will be formulated in the last part, relating the challenges that changes in this arena

entail.

1- The Study of Corruption and Democracy

Most of the analyses done regarding the effects of corruption democracy have

examined matters such as the factors that have led corruption to take root in a given

political system and its systemic positive or negative consequences in the economic field.

Other studies have emphasized the way corruption impinges upon regime legitimacy as

well as political culture.

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However, almost inevitably, many transcendental problems are commonly left

out as a consequence of analyzing different parts which composes a whole concept,

democracy in this case.

Hence, it is my intention to pull together different aspects of the most important

recent scholarly works on corruption and democracy, in the light of Merkels concept of

embedded democracy, which I consider is the best definition of what a consolidated,

liberal, deep-rooted and long lasting democracy should look like. At the same time, I will

break down such definition and explain how corruption affects each of the spheres

described by such definition.

This approach is important and realistic because culturally, democracy is a term

that varies along time and geography. While advanced industrialized countries have

emphasized democracy as the only dame in town and the rule of law, Roderic Camp

reports that surveys conducted in Costa Rica, Mexico, and Chile suggest that most Latin

American countries do not conceptualize democracy as do North American theorists or

citizens. He points out that what most distinguishes the Latin American version of

democracy from that of the United States is its emphasis on social and economic equality

and progress.1 According to Latinobarmetro, only 53% of the population in LA supports

democracy as a regime and only 31% of the people are satisfied with democracys

performance. The most important variations of these numbers occurred in recent years

during economic crises or recoveries.

Moreover in Latin America, a region greatly divided along socioeconomic lines,

democracy may not represent the same for all citizens. In fact, recent critiques on the study

1 John Bailey. Corruption and Democratic Governability in Latin America: Issues of Types, Arenas, Perceptions, and

Linkages.Prepared for delivery at the 2006 Meeting of the Latin American Studies Association. San Juan, Puerto Rico,March 15-18, 2006.p. 18

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of democracy suggest that research must move from an elite-level to a mass society level.

Thus, this last element will be taken into account in the development of this paper.

2- The Concept of Embedded Democracy

Merkel sees democracy as a complex of interdependent and independent partial

regimes.2 He points out that an embedded democracy is composed of five partial regimes: a

democratic electoral regime, political rights of participation, civil rights, horizontal

accountability, and the guarantee that the effective power to govern lies in the hands of

democratically elected representatives.

Figure 1

Merkels Concept of Embedded Democracy

In addition, Merkel argues that modern democracies are complex institutional

structures. They have to cope with the structural conditions of modern rule, both internally

in terms of complex societies and externally in terms of a challenging environment. They

have to develop certain structures to be able to fulfill various functions.3

2 Merkel, Wolfgang. Embedded and Defective Democracies,Democratization, 11, 5, December 2004, p. 433 Ibid.

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As figure 1 suggests, specific interdependence/independence of the different

partial regimes of a democracy secures its normative and functional existence internally.

Externally, on the other hand, these partial regimes are embedded in spheres which enable

conditions for democracy that protect it from outer shocks and destabilizing tendencies.

The concept of embedded democracy goes beyond the most famous definitions

put forth by Hutington, Przeworski, Diamond and Linz and Stepan. All of them have

explained that fair elections are a necessary but not sufficient condition for democracy.

More importantly, they have converged on an understanding of democracy as a discernible

process by which the rules, institutions, and constraints of democracy come to constitute

the only game in town, the one legitimate framework for seeking and exercising political

power.4 In the same direction, Dahl explains that because no large real-world system is

fully democratized, it is more useful to focus on the term polyarchy. Dahl defines polyarchy

as a regime that has been substantially popularized and liberalized, that is, highly inclusive

and extensively open to public contestation.5Although those definitions are ample, they

do not take into account environmental factors that might invalidate or threaten the

democratic process. Merkel includes social and economic conditions as requisites for

democracy yet her concept is realistic because of the fact that it is based exclusively on the

institutional architecture of a democracy and does not use outputs oroutcomes as defining

characteristics of a constitutional democracy.6

Thus, especially for the study of Latin America, Merkels definition becomes

relevant. Under an embedded democracy, fair distribution of economic goods and social

justice matters for a democracy but at the same time these factors do not define what a

4 Consolidating the third wave democracies / edited by Larry Diamond. Baltimore: Johns Hopkins University Press, 1997,

p. xvi5 Dahl, Robert A. 1971.Polyarchy: Participation and Opposition. New Haven, CT: Yale University Press. p. 86 Merkel 2004, 36

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democracy is or is not. Even though authors like Lipset have deeply studied social

requisites for democracy, the embedded democracy approach unifies institutions, civil

society and social and economic factors but at the same time delineating their diverse

nature.

3- The Concept of PoliticalCorruption

I will present what Mark E. Warren and Joseph Nye, separately, have explained

about what political corruption. Then, following Michael Johnston and John Bailey, I will

propose a broader definition.

Warren explains that the broadest meaning of political corruption is not in

dispute: political corruption is the inappropriate use of common power and authority for

purposes of individual or group gain at common expense.7 In Warrens view, all meanings

of political corruption, ancient and modern alike, share the following characteristics: 8 (a) an

individual or group of individuals is entrusted with collective decisions or actions; (b)

common norms exist regulating the way individuals and groups use their power over

collective decisions or actions; (c) an individual or group breaks with the norms; and (d)

breaking with the norms normally benefits the individual or group and harms to the

collectivity.

Joseph Nyes commonly used definition states that[c]orruption is the behavior

which deviates from the formal duties of a public role because of private-regarding

pecuniary or status gains; or violates rules against the exercise of certain types of private-

7 Warren Mark E. What Does Corruption Mean in a Democracy?American Journal of Political Science. Vol. 48, No. 2,

April 2004, p. 3328 Ibid.

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regarding influence. This includes such behavior as bribery; nepotism; and

misappropriation.9

These definitions are lacking somewhat because they assume that all corrupt acts

are illegal. Although norms may be formal or informal, what is conceived as corrupt varies

considerably across political units and time. For example, with respect to financing political

parties, lobbying for legislation, and gift giving, all these activities may be legal practices

yet still be conceived as corruption because their results undermine basic features of

democracy such as representation, accountability and oversight. Another limitation of these

formal-legal centered definitions arises when analyzing neoliberal policies. For example, as

John Bailey explains, we find varieties of public functions (welfare, education or even law

enforcement) delegated to private firms in the neoliberal state.

Figure 2

Major kinds of Political Corruption10

9 Nye, Joseph S. 2002 [1967]. Corruption and Political Development: A Cost-Benefic Analysis in Arnold J.

Heidenheimer and Michael Johnston, eds.,Political Corruption: Concepts and Contexts (New Brunswick, N.J.:Transaction Publishers), p. 28410 Global Corruption Report 2004, Transparency International. p. 20

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To address these gaps, Johnston suggests that we use Nyes definition but we also

add the public opinion variable.11That is, we must take into account what people perceive

as corrupt behavior. This is particularly important because the public may interpret

corruption where legality is present but honest behavior is not. Therefore, under this

approach, lawful acts may actually be corrupt at the same time.

11 Heidenheimer and Johnston 2002, pp- 3-14

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Thus, I propose to use the term political corruption as the misuse of public or

private positions that are destined for public ends, for illegitimate individual or group

advantage as well as the violation of customary norms of good public-office behavior.

4- Internal Embeddedness and Political Corruption

According to Merkel, the partial regimes can only function in a democracy if they

are mutually embedded. This implies two things: some partial regimes support the

functioning and development of another partial regime and on the other hand some partial

regimes ensure the political actors do not infringe on the functional spheres of another

regime.

In this section, I intend to offer some examples in the opposite direction of what

according to Merkel an embedded democracy should be. Merkels definition permits us to

identify defects in one or more partial regimes in relation with different countries and the

way political corruption impinges upon them.

A) The Electoral Regime

As Merkel underlines, the electoral regime has the central position among the

five partial regimes of embedded democracy, as it is the most obvious expression of the

sovereignty of the people, the participation of citizens and the equal weight allotted to their

individual preferences.12 Likewise, open, pluralistic competition for positions of power is

the distinctive difference between democracy and autocracy.13

12 Merkel 2004, 3813 Ibid

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The same way the third wave of democratization has transformed the balance of

political regimes in the world, it has caused the same effects in Latin America. Most Latin

American countries however remain being just electoral democracies and not consolidated

democracies. When Mexican intellectual Porfirio Muoz Ledo was asked whether after the

early July presidential elections Mexico could finally be considered as a consolidated

democracy, he offered a twofold argument for a negative response: (1) the democratic

transition will not be completed unless a deep institutional reform which limits

authoritarianism and leads to a genuine rule of law is implemented; and (2) even though the

Mexican electoral system proved to work logistically correct, we cannot even speak about

an electoral democracy due to a series of illegal acts previously executed by public

agents.14 Such acts, he mentioned, enormously favored PAN Candidate Felipe Caldern,

who apparently won the elections with less that .4 percent of votes.

Public abuses of such kind not only were illegal but can also be deemed corrupt

and have thus affected the legitimacy of the entire electoral process because they strongly

influenced Calderons position in the presidential race. Calderons subsequent victory has

been marred by questions of illegitimacy. According to Mexico Citys Public Security

Department, consequently, on July 16th more than one million people gathered in el Zocalo

in which is considered to be the biggest protest in the citys history.15 With Lopez Obrador

leading the protest, the peoples demand was a complete recount of the votes for president,

a decision that will depend on the Electoral Courts. Nonetheless, social pressure and threats

of instability will play a major role in the courts decision.

14 http://www.eluniversal.com.mx/editoriales/34829.html15 http://www.eluniversal.com.mx/notas/362713.html

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As this case demonstrates, Mexico is still in its route for democracy and

corruption plays a major role in the electoral regime. An excessively powerful media, to

which more than 90% of the electoral expenses are directed, has several times lobbied for

legislation that favors its position of privilege. Political parties continue to adhere to a

number of corrupt practices and such acts, as Blechinger has explained, can undermine

public trust and lead to voter cynicism and disillusionment with the political system, thus

threatening the viability of democracy.16Although Mexico has been active through the

promotion of federal, state, and local laws on access to public information, much work

remains to make democratic institutions more accountable, or even more, to give them the

capacity to oversee electoral campaigns.

The case presented also shows the extent to which corruption may alter the

expression of the sovereignty of the people. Thus, en embedded democracy will be

difficultly achieved under such conditions. In this context, Robert Dahl has suggested that a

democratic electoral regime has four supporting elements: universal, active suffrage;

universal, passive right to vote; free and fair elections; and elected representatives.17 Those

elements should be privileged not only formally by Latin American constitutions but also

by the institutional system and the political processes of each country.

B) Political Rights

Merkel explicates that political rights of participation are preconditions for

elections. They go beyond the right to vote. They complete the vertical dimension of

democracy and make the public arena an independent political sphere of action, where

16 Blechinguer, Verena. 2005. Political Parties inFighting Corruption in Developing Countries: Strategies and

Analysis. Edited by Bertram I. Spector. Kumarian Press. p. 2817 Merkel 2004, 38

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organizational and communicative power is developed.18 Although the electoral regime

and political rights alone do not secure standards for responsible governments, when they

reinforce each other (when they are embedded, in other words,) the result constitute the

ground under which more political achievements can be conceived.

Because political rights and electoral regimes are profoundly interconnected, the

way corruption affects democracy must be conceived as Warren has pointed out:

corruption breaks the link between collective decision making and the peoples powers to

influence collective decisions through speaking and voting, the very link that defines

democracy.19

In Venezuela, for example, although its government was democratically elected,

its authoritarian features along with its high level of corruption, undermines extensively the

exercise of constitutional political rights. Venezuela was ranked 114 out of 146 countries

surveyed in Transparency International's 2004 Corruption Perceptions Index.

At the national level, there are no independent government institutions. The

military high command is loyal to a single person, the president, rather than to the

constitution and the law. Chavez's party, the Fifth Republic Movement, controls the

National Assembly (though narrowly), as well as the Supreme Justice Tribunal and the

intelligence services. It also controls the Citizen Power branch of government created to

fight corruption by the 1999 constitution. Although the constitution provides for freedom of

the press, exercise of that right is becoming increasingly difficult in practice. In 2003, as the

country moved towards a referendum on Chavez's presidency, the government proposed

several measures to tighten its control over opposition newspapers and television and radio

18 Merkel 2004, 3819 Warren 2004, 328

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stations. Indeed, a Supreme Court ruling upheld censorship laws that effectively declared

that laws protecting public authorities and institutions from insulting criticism were

constitutional. Security forces frequently break up strikes and arrest trade unionists. On the

other hand, the Chavez government has done little to free the government from excessive

bureaucratic regulations, registration requirements, and other forms of control that increase

opportunities for corruption. A 2003 study by the World Bank found that Venezuela has

one of the most regulated economies in the world.20

Perez Parra explains that most Venezuelans voted for Chavez as an anticorruption

response against past governments.21 Conversely, even though Chavez promised to end the

problem of corruption, Venezuelas case represents a form of institutionalized treason to

thousands of votes of people that over time experienced a weakening of their political

rights. Such weakening is result of a regime that, because of its nature, cannot oppose

corruption determinately. What is more, the regime shares the three characteristics

mentioned by Luigui Manzetti for high corruption to take place: (1) many checks and

balances among the three branches of government and the institutional mechanisms to

combat corruption are weak or not used; (2) there are not self-restraints in profiting from

corruption and commissions reach extremely high levels; and (3) corruption is so

widespread at the societal level as to be accepted and tolerated.22

As Robin Hodess mentions, in transition and developing states, political

corruption threatens the very viability of democracy, as it makes the newer institutions of

democracy vulnerable.23 Vulnerable democratic institutions consequently shrink the

domain of political rights that certain society may exercise.

20 Freedom House - http://www.freedomhouse.org/template.cfm?page=15&year=200521 United Nations - http://unpan1.un.org/intradoc/groups/public/documents/CLAD/clad0044108.pdf22 Bailey 2006, 1123 Global Corruption Report 2004. Transparency Internacional.

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C) Civil Rights

Civil rights are the protections and privileges of personal liberty given to all

citizens by law. Civil rights are distinguished from "human rights" or "natural rights"civil

rights are rights that are bestowed by nations on those within their territorial boundaries,

while natural or human rights are rights that many scholars claim ought to belong to all

people. For example, the philosopher John Locke argued that the natural rights of life,

liberty and property should be converted into civil rights and protected by the sovereign

state as an aspect of the social contract. Others have argued that people acquire rights as an

inalienable gift from the deity or at a time of nature before governments were formed. 24

Civil rights acquire special relevance in a region like Latin America. Eduardo

Bustelo defends the idea that since the three central problems in Latin America are social

inequality, the increasing vulnerability of majority sectors of the population and increasing

social exclusion, social rights are the gateway in order to build citizenship.25 Bustelo, of

course, refers to the importance of enforcing such rights. In this sense, Merkel states that

civil rights are central to the rule of law. 26 I would say however that the rule of law is

central to civil rights because of the simple reason that it is the rule of law what allows

those civil rights to be either plenty exercised or enforced, in the case of excesses of state

power. In other words, the rule of law is an instrument that ideally should allow the

exercise the rights of citizenship provided by any modern Constitution.

24 Wikipedia25 Bustelo Eduardo S., Expansion of Citizenship and Democratic Construction: Contemporary Challenges and New

Paradigms, in The Poverty of Rights: Human Rights and the Eradication of Poverty. Edited by William van Genugtenand Camilo Peres-Bustillo. London, Zed Books, 2001. p. 2526 Merkel 2004, 39

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As Guillermo ODonell explains the rule of law means that all citizens are equal

before the law, and that the laws themselves are clear, publicly known, universal, stable,

non-retroactive, and fairly and consistently applied to all citizens.27

Therefore, for civil rights to be guaranteed, there need to be further aspects of

the rule of law, such as independent courts28 that oversight the functions of the executive

and legislative powers. Although this problematic is the central point of the next section, it

is very important to understand that political corruption in the justice sector may undermine

the entire processes of democracy and rule of law. As Mary Noel Pepys illustrates,

[t]ipically, the justice sector includes judges, prosecutors, the police, public defenders, the

private bar, court personnel, and court decision enforcement agencies such as penal

institutions.29

In corrupted judicial systems, Pepys explains, the powerful and wealthy can

escape prosecution and conviction, while large segments of society are excluded from their

rightful access to fair and effective judicial services. Therefore, corruption in the justice

system undermines the nature of civil rights in any given country.

According to Pepys, many reasons may lead to a corrupt justice sector: the role of

government, governmental leaders engaged in corrupt behavior, a system based on personal

influence and contacts, and tolerance toward corruption.30 Indeed, we could add historical

weaknesses of the judicial sector caused by the kind of anti-accountability attitudes present

in what ODonell has called delegative democracies.31

27 Introduction in Assessing the Quality of Democracy. Edited by Larry Diamond and Leonardo Morlino. Baltimore:

Johns Hopkins University Press. 2005. p xiv28 Merkel 2004, 3929 Mary Noel Pepys. 2005. Justice System inFighting Corruption in Developing Countries: Strategies and Analysis.

Edited by Bertram I. Spector. Kumarian Press. p. 1330 Pepys 2005, 1531 Consolidating the third wave democracies / edited by Larry Diamond. Baltimore: Johns Hopkins University Press,

1997, p. xvii

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In Guatemala, citizens have access to the judicial system, but there is beleived to

be much corruption and influence-peddling in the courts. Citizens without financial

resources tend to be at a disadvantage. The courts have an internal disciplinary process, but

it is not always functional. Programs such as witness protection are little developed. There

are two institutions, the Comptroller General and the Public Ministry, whose responsibility

is to detect cases of corruption, present evidence and bring the guilty parties to justice.

Their effectiveness is very limited, and the central government has interfered with both. In

2002, a Transparency Commission was created, but it entered into crisis because of reports

of lack of transparency in its own actions.32 Undeniable, the situation of civil rights in

Guatemala makes of the idea of an embedded democracy just a utopia.

E) Division of Powers and Horizontal Accountability

By quoting ODonell, Merkel explains that horizontal accountability implies that

elected authorities are surveyed by a network of relatively autonomous institutions and may

be pinned down to constitutionally defined lawful actions.33 Whereas institutions of vertical

accountability control the government only periodically, a perdurable set of institutions of

horizontal accountability provide certainty in the use of power. I would like to emphasize in

this sense Transparency Internationals elements of a national integrity system. Such

scheme goes beyond the importance of the division of power between mutually

independent and autonomous legislative, executive and judicial bodies.

Pope argues that under a strong national integrity system a virtuous circle is

perfected: one in which each actor is both a watcher and is watched, is both monitor and is

32 Guatemala: Integrity Assessment 2004, Global Integrity. http://www.globalintegrity.org/2004/country.aspx?

cc=gt&act=ia33 Merkel 2004, 40

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monitored. A circle avoids, and at the same time answers the age-old question: Who shall

guard the guards?34

Since the third wave of democratization began, the shift in Latin America has

been from vertical responsibility (the tyrant or the leadership of the one party state) to

horizontal accountability (whereby a system of agencies of restraints and watchdogs are

designed to check abuses of power by other agencies and branches of government.)

Figure 3

Diagram from Pope

As Figure 3 shows, an ideal system of national integrity that implies horizontal

accountability embodies a number of pillars which represent the core tools for a system in

which corruption is avoided and combated. Those pillars are sustained by public awareness

and societys values. Furthermore, resting on the roof are three round balls representing the

goals of the entire system: sustainable development, rule of law, and quality of life.

34 Pope, Jeremy. Transparency International: Source Book 2000, The Elements of Confronting Corruption: Integrity

System.

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Insofar as corruption penetrates the different pillars under which a system of

horizontal accountability is constructed, it undermines the democratic process.As Bailey

explains, political corruption may influence the core processes of democracy taken in the

procedural sense and it also may influence rule-making aspects of public policy-making.35

Thus, corruption becomes doubly harmful. What is more, under this approach, the real

damage is done when several pillars participate in the same acts of corruption, nullifying

their purpose as watchdogs.

Pope has emphasized that the pillars are interdependent but may be of different

strengths too. Such pillars may vary from society to society as well. However, Pope argues,

there will always be trade-offs to accommodate this.

With regard to inexistence or damaged horizontal accountability, many examples

arise in Latin America. Recently, reforms that strengthened the monopoly of Mexicos two

biggest TV broadcast networks were passed by the Federal Congress in the face of rejection

of international organizations like the United Nations and national universities, research

centers and hundreds of radio stations. The worst part is that as a result of the companies

intense lobbying, the reforms were proposed by the President, who could not do much

because of fear of reprisal. In the same sense all political parties (the left included) passed

the eminently antidemocratic reforms, given that the presidential elections were close to

take place and they did not want their respective candidates to be affected.

On the other hand we have Colombia, which has been marked by the corrupt

political machine of the Liberals and the Conservatives (whose leadership has largely been

drawn from the traditional elite) as well as by left-wing guerrilla insurgencies, right-wing

paramilitary violence, the emergence of vicious drug cartels, and gross human rights

35 Bailey 2006, 5

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violations committed by all sides. Corruption affects virtually all aspects of public life and

extends far beyond the narcotics trade. Anticorruption activists claim that the annual cost of

systemic problems exceeds $2.2 billion and that corruption may be a greater threat to the

country's institutional survival than is the internal war. More than 120 journalists have been

murdered in the past decade, many of whom were killed for reporting on drug trafficking

and corruption; most of the cases remain unresolved by the legal authorities. The justice

system remains slow and compromised by corruption and extortion. Indeed, in the year

2002, a new chief of the national police was named after a corruption scandal involving 71

officers (including the head of anti-narcotics operations) who were accused of stealing

more than $2 million in U.S. aid.36

Mexicos case presents a problem of state capture originated in a lack of

accountability among different institutions which are supposed to compose horizontal

accountability. Colombias case on the other hand exposes an endemic condition of

corruption in which the executive, the judiciary, the military, and supranational organisms

have discouraged or even made impossible any possibility for the media and other

organizations to function as factors of equilibrium vis--vis the excessive exercise of

power.

E) Effective Power to Govern

This is the other side of the coin. According to Merkel, this regime stresses the

necessity that elected representatives are the ones that actually govern. An application of

this criterion prevents extra-constitutional actors not subject to democratic accountability,

36 Freedom House

http://www.freedomhouse.org/template.cfm?page=15&year=2005

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like the military or other powerful actors, from holding (final) decision-making power in

certain policy domains.37

I would like to go beyond. Effective power to govern is the essential element for

any state, democratic or not, to either function or, in Weberian terms, to exist. Latin

America (especially during the 1970s) and many countries across the world, have

convincingly demonstrated how democracies in which only pluralism and liberty exist,

quickly fail and experience reversals towards authoritarian regimes (military most of the

times) under the pretext that their leaders are who really are capable of delivering goods or

results in general terms. Bossle and Lummer have eloquently explained the way authority is

enormously needed although many times it is seemed as to be opposed to liberty and

autonomy.38 However, as Lummer explains, liberty and order reinforce each other. Order is

necessary for individuals acting with liberty. For that reason, a democratic consensus on the

rules governing the spaces of order and liberty must exist and an authority strongly

representing the sovereignty of the people must make those rules prevail and be enforced.

Merkel proposes useful examples in his article regarding insufficient control of

the government over the military and the police. Yet his examples are mild. We have also

to connect governmental authority with performance in relation to growth, equity, and the

extent to which a government is representative of a nations interest. For instance, we could

use Sorensens description about types of democracies. There are, in his view, elite-

dominated democracies and mass-dominated democracies. In elite-dominated democracies,

corporate interests may prevail over the majority of the people even if the country as a

whole is considered to be an electoral democracy. In this sense, many interests may be

37 Merkel 2004, 4138 Autoridad y libertad para la democracia / Lothar Bossle. Santiago: Ediciones Universidad Catlica de Chile, 1983. pp.

23-98

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strong enough to easily influence the authority who is supposed to be effective in the art of

politics. That is, in fact, part of what an illiberal democracy is all about. Not only does it

matters who take the (final) decisions but also the direction of such decision.

In general terms, the lack of effectiveness of the authority governing a state is

clearly visible when the courts are not obeyed, when the police is not respected, when a

president governs before permanent gridlock, when legislators represent elites interests

over mass interests, when the military takes decisions in the policy-making process, and so

forth.

Political corruption is thus embedded in this partial regime in a number of

countries. According to Transparency International, 70 per cent of countries score less than

5 out of a clean score of 10. The nature of political corruption makes different spheres of

power to be easily mixed in weak democracies and in strong democracies. The extent to

which corruption distorts the democratic process depends on the strength of institutions and

on how well authorities apply political power toward the state according to constitutional

and democratic principles.

Argentina under Menem is a great example of corruption that affects

governmental authority. According to Levitsky, several top government officials, including

Labor Minister, Public Works Minister, National Administration of Health Insurance

director, Environment Minister, Integral Medical Attention Program director, and Sociedad

Mixta Siderrgica auditor, were implicated in high corruption. None were brought to

justice. Even more alarming was the degree to which the late mafia boss Alfredo Yabran

penetrated the political system during the 1990s. Although the full extent of Yabrans

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influence has yet to be ascertained, it is clear that he maintained close ties with top

government officials and financed a large number of legislators in both major parties.39

In another case, Diamint reports that in 1998 the Argentine press reported on the

involvement of military industries, a dependency of the Ministry of Defense and the

Argentine Army, in a weapons sales scheme to Ecuador and Croatia. The sales were

arranged illegally with the complicity of members of the executive branch and the use of

revenues from these sales remains unknown.40

On the other hand, Fujimoris autogolpe, in which he disbanded Congress and

courts, obviously represents a lack of authority on the part of any power that is not part of

the executive.

Consequently, the power of the mafia and the military in Argentina as well as the

excessive presidential power in Peru in 1992 set out questions about who actually exercises

public power.

5- External Embeddedness and Political Corruption

Merkel explains that [e]very democracy as a whole is embedded in an

environment that encompasses, enables, and stabilizes the democratic regime. Damage to

this environment often results in either defects or destabilization of the democracy itself.41

It is also important to underline that the rings in which a democracy is externally embedded

39 Steven Levitsky. 2003. Argentina: From Crisis to Consolidation (and Back) in Constructing Democratic Governance

in Latin America / edited by Jorge I. Domnguez, Michael Shifter. Baltimore : Johns Hopkins University Press. p. 24840 Rut Diamint. 2003. The Military in Constructing Democratic Governance in Latin America / edited by Jorge I.

Domnguez, Michael Shifter. Baltimore : Johns Hopkins University Press. p. 5841 Merkel 2004, 44

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are conditions that improve or worsen the quality of a democracy, but are not defining

components of the democratic regime itself.

In this section, I aim to describe the most important effects that political

corruption causes to three of the four external conditions under which a democracy ideally

is grounded: socio-economic context, civil society, and international context/integration.

Since stateness (issues of identity and burdens of political community) is a condition for the

mere existence of the state, and because a democracy can only exist in states clearly

constituted, stateness will not be studied in this paper.

A) The Socio-Economic Context

The relation between economic prosperity of a nation and its democratic

consolidation is undeniable. Beyond the impact of national wealth and economic

stratification (which may be devastating in impoverished countries,) Lipset argues that

Tocqueville, Sartori, Dahl, Dogan, and Weffort, have defended the idea that social

equality, perceived as equality of status and respect for individuals regardless of economic

condition, is highly conducive for democracy.42 Indeed, Przeworski has empirically

demonstrated that the expected life of democracy increases with per-capita income and that

democracy is much more likely to endure in countries where income inequality declines

over time than where it increases.43

It is not difficult to link political corruption and poverty and inequality. As

Klitgaard has pointed out, corruption is a major problem of governance and is inherent in

systems built on poverty.44

42 Seymour Martin Lipset, Social Requisites of Democracy Revisited,American SociologicalReview, 58, 1994, p. 243 Consolidating the third wave democracies / edited by Larry Diamond. Baltimore: Johns Hopkins University Press,

1997, p. xxxiii44 Lipset 1994, 3

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According to a World Bank report released in 200645, while growth is key for

poverty reduction, poverty itself is hampering the achievement of high and sustained

economic growth rates in Latin America, which remains one of the most unequal regions in

the world with close to a fourth of the population living on less than US$2.00 a day.

Performance varies, with Costa Rica and Chile demonstrating success in alleviating poverty

while citizens in countries such as El Salvador and Guatemala remain desperately poor.46

In this context, Heidenheimer and Johnston argue that poor countries share a

number of interlinked development problems, of which corruption is just one. Accordingly,

we can observe corruption and poverty and inequality as intertwined problems that

reinforce a vicious circle.

As regards the debate of the relation between corruption and economic growth,

Nattalie Leff offers a classic statement of a point of view that was widely held at one time:

that corruption facilitates economic development by breaking through bureaucratic

bottlenecks, serving as an informal price system, making rigid official development policies

more flexible and humane, and by putting public resources and favorable decisions up for

bids, channels them to people and groups able to use them efficiently. 47 Pranab Bardhan

argues that while beneficial consequences of particular corrupt transactions cannot be ruled

out, overall the economic effects are negative. Paolo Mauro provides solid empirical

evidence to support this view. Using corruption indices for over a hundred countries over

several years, he shows that a harmful relation between corruption an growth can be seen

trough two perspectives: (a) direct, via the disruption of markets; and (b) indirect, because

45 Poverty Reduction and Growth: Virtuous and Vicious Circles. World Bank, 2006

http://www.worldbank.org/46 Franko, Patrice. The Puzzle of Latin American Economic Development. Rowman & Littlefield. 2003, p. 37747 Political corruption: concepts & contexts /Arnold J. Heidenheimer, Michael Johnston, editors. New Brunswick, N.J. :

Transaction Publishers, 2002, p. 304

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scarce public resources are diverted away from education, a long-term investment in the

human side of development, toward big-ticket expenditures ehere sizable rents can more

readily be extracted.48

Rueschemeyer has stated that [to] deepen democracy in the direction of greater

democratic equality requires systematic and strong policies promoting social and economic

equality and long sustained policies of social protection and solidarity.49 Most state

policies depend on how much money the state can get, and the issue of the public budget

depends beforehand on efficiency and economic growth.

In short, corruption affects the process of democratic consolidation since it

shrinks possibilities for economic growth (an essential environmental condition for

democracy which influences levels of poverty and inequality) and effectiveness in the

implementation of public policies.

B) Civil Society

This is probably the most encompassing issue about the relationship between

corruption and democracy in Latin America. Yet I intend to be concise in this part. The

analysis of civil society in this context leads us to two important topics: political culture

and social capital.

Merkel highlights very decently the essential points of important theorists on civil

society. John Lockes emphasis on the necessity of civil societys protection from arbitrary

state rule, Montesquieus idea on the balance between state authority and civil society,

Tocquevilles accent on free associations and free community, and Hbermas concern

48 Ibid, 30549 Assessing the Quality of Democracy. Edited by Larry Diamond and Leonardo Morlino. Baltimore: Johns Hopkins

University Press. 2005, p. 59

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about institutionalization of the public sphere as a medium of democratic self-protection,

are all elements that provide the foundations of a strong civil.

Nevertheless, Latin American societies present patterns of poor economic

performance and lack of interpersonal trust as a consequence of vertical clientalist

relationships and social discrimination policies developed since colonial times. Although

much change has been accomplished to build stronger civil societies, five important

questions must be answered concerning the relation between civil society and corruption:

(1) Is corruption decreasing with the arrival of democracy to Latin America? (2) Is there a

connection between levels of corruption described by agencies like Transparency

International and levels of corruption perceived by common people in Latin America? (3)

What is the possible impact of peoples perceptions about corruption on support for specific

administrations, support for the political system, and support for democracy as a form of

government? (4) What are the effects of lack of interpersonal trust on social capital? (5)

Finally, what are the institutional priorities for countries aiming at getting rid of high levels

of corruption?

To answer the first question, Weyland argues that corruption has increased in

Latin America due to a series of factors. He argues that the dispersion of power originated

in the replacement of dictatorships by democracies has widened the opportunity for bribery;

that there are many more veto players; that neoliberal reforms have involved opening

many areas of the economy to bribery, especially privatization of public companies; and

that the increasing number of neopopulist leaders get frequently involved in corruption

because of their need to gather enough money to pay for TV time.50 I do believe that

democracy decentralizes corruption but I do not think that the overall cost benefit result can

50 Weyland, Kurt. 1998. The Politics of Corruption in Latin America. Journal of Democracy 9.2 108-121

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be disseminated without using data and the Weyland thesis is lacking in this area.

Additionally, I believe that a strong democracy is the best method under which corruption

can be fought.

Secondly, Canache and Allison used Transparency International corruption index

(CPI) and World Values survey from several Latin American countries. Their analysis

reveals that there is a strong degree of correspondence between levels of corruption as

indicated by the CPI and as perceived by mass publics.51

Figure 5

Transparency International Corruption Perception Index 2005

North and South America

With regard to the third question, authors like Davis, Ai Camp, and Colema have

demonstrated that perceived corruption is linked to decreased support for an incumbent

administration and to an erosion of regime legitimacy and systemic support for

51 Damarys Canache and Michael Allison. Corrupted Perceptions: The Effect of Corruption on Political Support in Latin

American Democracies.Prepared for delivery at the XXIV International Congress of the Latin American StudiesAssociation, Dallas- Texas; March 27-29, 2003. Available at:http://home.earthlink.net/~allisonmhsd/sitebuildercontent/sitebuilderfiles/politicalcorruption.pdf

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governments.52 However, Canache and Allisons most striking finding is that perceptions of

corruption have not soured mass opinion on democracy as a form of government. Hence,

they explain that the necessary ingredients for accountability are present in Latin

America (however,) whether mass opinion alone can offer a sufficient check on

corruption is, of course, highly questionable.53 Yet they recognize that even tough citizens

in the region apparently do not view corruption as an inherent feature of democratic

governance, there is no guaranty that this perceptual link will not emerge in future years if

corruption continues unabated.54 Before answering the fourth question, it is important to

underline two things. First, in order for a political regime to function reasonably well,

actions taken by leaders need to be viewed as legitimate. If not, the degrees of freedom

with which decision makers have to operate are reduced considerably.55Second, as Bailey

has explained, perceptions of corruption are associated with withdrawal and voter

abstention. A deepening of democracy means the opposite, the opening of channels

through which discontented citizens can find effective voice through democratic

participation.56

As regards the fourth question, Robert Putnam points out that any society is

characterized by networks of interpersonal communication and exchange. Overcoming

dilemmas of collective action depends, in his view, on how strong social capital is, a system

of interpersonal relations based on trust.57 Because the corrupt exchange, as Bailey has

explained, is a complex transaction in which government and civil society can be both

52 Davis, Ai Camp, and Coleman. 2004. The influence of Party Systems on Citizens Perceptions of Corruption and

Electoral Response in Latin America. Comparative Political Studies. Vol. 37 No. 6, pp 700-70153 Canache and Allison 2003, 1854 Canache and Allison 2003, 1955 Seligson, Mitchell. 2002. The Impact of Corruption on Regime Legitimacy: A Comparative Study of Four Latin

American Countries. The Journal of Politics, Vol. 64, No. 2, p. 42956 Bailey 2006, 1757 Robert Putnam, Making Democracy Work,pp., 163-185

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victims and corruptors58, overcoming corruption is also dilemma of collective action. In this

context, Moreno studied more than 60 societies and he got to two conclusions. First,

acceptance of corrupt practices is culturally undemocratic because corruption

permissiveness erodes support for democracy and interpersonal trust. Second, the trend in

the last two decades, when democratization took place in a significant number of countries

during the third wave of democratization corruption permissiveness has not decreased

significantly. In some cases it has increased.59Hence, tolerance toward corruption remains

as one of the most interesting and not commonly studied developments within fledgling

democracies.

In this context, Warrens thoughts on the way corruption undermines the culture

of democracy are relevant. He explains that [w]hen people lose confidence in democratic

institutions they come to expect duplicity in public speech, and the expectation tarnishes all

public officials, whether or not they are corrupt.60 And when people are mistrustful of the

government, Warren argues, they are also cynical about their own capacity to act on public

goods and will prefer to attend narrow domains of self interest they can control.

Consequently, when perceptions are low, the consequential lack of trust will always

diminish possibilities to construct social capital.

Finally, according to Johnston, reform priorities for countries aiming at

combating corruption are reforms of institutions, procedures, and personnel needed at the

micro level; and fostering open, balanced, fair political and economic competition; and

building strong, legitimate institutions at the macro level.61 Johnston also suggests that a

58 Bailey 2006, 6-759 Moreno, Alejandro. 2002. Corruption and Democracy: A Cultural Assessment. Author. Comparative Sociology,

Volume 1, Numbers 3-4, pp. 495-50760 Warren 2004, 32861 Michael Johnston. 2000(revised). Corruption and Democratic Consolidation.Prepared for a Conference on

Democracy and Corruption in Princeton University on March 12, 1999.p. 32.Available at:http://people.colgate.edu/mjohnston/MJ%20papers%2001/Princeton.pdf

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healthy balance between political participation and the role of institutions is strongly

needed. His institutional emphasis is due to what he calls possibilities for institutionalized

corruption as a result o lack strength within democratic institutions.

C) International and Regional Context

As Merkel explains, if regional mechanisms that secure democratic values are

absent, governments have a broader range of opportunities for violating democratic

institutions. Therefore, historical international developments are fundamental to understand

the relation between political corruption and democracy.

In this case I could not find a more relevant case to exemplify this situation than

the relationship between the United States and Latin America described by Seligson:

during the Cold War, the United States and its allies tolerated corrupt (often hyper-

corrupt) regimes in the Third World, so long as those regimes took their side in the struggle

against communism. As the same author states, even prior to the Cold War, alliance

politics overrode concerns about corruption, a policy Franklin Delano Roosevelt

crystallized in his famous remark about the Somoza dictatorship in Nicaragua: Hes a son-

of-a-bitch, but hes our son-of-a-bitch.

However, communism is no longer a threat either to democracy as a political

regime or to liberalism as an economic system. In addition, with the arrival of at least

electoral democracy to most of Latin America, concerns about corruption are being

observed by international organizations and industrialized countries, which consider

corruption as an obstacle for free trade and international efforts to combat other problems

such as drug trade.

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6- Conclusions

With this paper I have demonstrated that corruption undermines democracy and

the strength and stability of its institutions and consequently it produces harmful exclusion

of those who have a claim for inclusion in collective actions and decisions. Another

essential point of this research has been to demonstrate that corruption is a phenomenon as

complex as the democratic process itself. By analyzing the relationship between internal

and external conditions for an embedded democracy, I have drawn a map of political

corruption with Latin American examples that allows us either partially or holistically

identify the way corruption impinges upon democracy.

Thus, single solutions must be discarded beforehand as ways to fight corruption.

What is needed, on the contrary, are multidimensional approaches which take into account

every aspect of democratic life, such as economic conditions, legal frameworks,

international factors, national institutions, political culture, educational policies, and so

forth. This is not easy task. Lack of sufficient money and resources, unarticulated political

will and competition among actors, a weakened rule of law, loopholes within reforms, and

aversion to change as well as cultural inertia of institutional structure are great obstacles

which must be overcome.

Because politics is the most powerful transforming element in any state, political

leadership that takes into account the complexities and challenges that the fight against

corruption involves, will have the strongest impact in consolidating Latin Americas

fledgling democracies.

corruption and democratic consolidation in latin america. paper by hector faya rodriguez

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