Sustainable Globalization and Corruption

Katherine Marshall, 13th IACC, Plenary Thematic Discussion, Sustainability

Plenary: Sustainable Globalization and Corruption

Athens, IACC November 2, 2008

Katherine Marshall, GeorgetownUniversityand World Faiths Development Dialogue

I begin with three short vignettes.

1.      In the September Vice Presidential debate, Joe Biden was asked what expenditures he would cut as the pressures from the financial crisis begin to bite; his first candidate was foreign aid. 

2.      When the singer Bono visited the American “heartland” recently, mobilizing support for HIV/AIDS and Africa, a first question he was asked at many stops was: “won’t the money just be wasted? Won’t it be stolen?”

3.      I confronted an African minister  some years ago (I was World Bank director at the time) about a scam  my colleagues had uncovered: the World Bank had financed top of the line (read very very expensive) management courses in the US for a group of young leaders, who had not bothered to pick up the books. The Minister did not answer, his eyes glazed, and he began to talk about what seemed an entirely different subject: the poor performance of an expensive European consulting firm whose two million dollar contract he clearly saw as an imposed foible and utter waste of money.

 I don't believe for a moment that an Obama administration will gut foreign assistance. Most aid programs are carefully managed.  And both training and management support for development often work well.

But these vignettes are vivid reminders of four immediate realities and problems: poorer countries are dramatically and often disproportionately affected by economic turmoil, ironically the assistance they need and deserve is the first off the boat, corruption is a key part of both the atmospherics and the realities, and finally, the issue of corruption is entangled in broader ethical challenges that globalization  brings to the surface.

The world is gripped by the financial crisis, whose dimensions are still unfolding.  It engulfs most meeting agendas. But already it is clear that the ricochet effects for poorer countries are enormous. The effects are not just belt tightening – daily reports speak of millions of jobs lost and political upheavals are already evident with more in the offing. The countries and communities at the end of the pavement have the least capacity to respond. 

Yet already we hear calls for cuts in foreign assistance and the extraordinary philanthropy which fuels so much of civil society is rapidly tightening.  Businesses are trimming back “altruistic” programs. We already faced a tough fight to keep the attention on the “silent tsunamis” of poverty, disease, children out of school, and to make the Millennium Development Goals the disciplined in your face reminder they are intended to be.  Now, the challenge is greater still, even as it is more important.

There are plenty of controversies that surround the development business.  Many question whether development programs work, whether foreign aid is a colonial vestige, and whether the money goes to the right places.  I see it as far better than  the critics claim, with remarkable programs and results.  It is a long term haul and much has been learned.  The system, however, has become so complex that many call to “get a grip” – to harmonize and  put some order into it all.  

In this complex picture, corruption is an insidious element at many levels: a real problem that leads to building shoddy schools, finding adulterated or expired medicines in clinics, and paying excessive cost for roads; it is above all else a polluter of trust and image.  It makes both an easy excuse and a reasonable cause for doubt about the estimated billions that are the price tags for that Minimum Development Goal, halving poverty by 2015 and ending hunger.

The issues of corrupt practices that we focus on here in Athens,  the practical and relatively actionable issues of procurement practices, accountability, and transparency, do tend to blend at the borders with a set of questions that turn around equity.  Equity is a tricky term that basically means justice and fairness, and the patent unfairness of today’s world comes in the picture.  The inequities of globalization are blatently evident in the pain of those, far from Wall Street, who are affected by slack banking practices in the United States.  I could give countless other examples.

It is easy to become bogged down in these questions about global equity and the search for solutions.  They range from obvious incremental reforms to blue sky dreams of the fair world that might be. 

As a pragmatic idealist, I come back to three practical conclusions: (a) we need all our alliances working to keep the focus on the poverty issues, as many here have done; it’s the name of the game for our children, together with climate change.  The divided world we have today is not sustainable.  (b)  We need to forge ahead with development assistance, for all its foibles.  We need to work to strengthen its basic integrity because that is vital both to making the case and making it work; and (c) We need to recognize , name, and address the ethical issues surrounding equity that are a part of the reason people shy away from talking about the “c” word, corruption. 

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