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How Corrupt is Britain?

People laughed when MP Neil Hamilton was found to have accepted money in a brown envelope – this is not the British way. But the bestowal of directorships and employment for family and friends is acceptable – ‘good form’ – lucrative and legal.

George Monbiot points out that many poor nations are plagued by the kind of corruption that involves paying bribes in that way, but adds that the British system already belongs to the elite.

cameron corruption

He notes that Transparency International’s corruption index ranks Britain 14th – why not lower? His explanation: “the definitions of corruption on which the index draws are narrow and selective. Common practices in the rich nations that could reasonably be labelled corrupt are excluded; common practices in the poor nations are emphasised”.

A former minister ran HSBC while it engaged in systematic tax evasion, money laundering for drugs gangs and the provision of services to Saudi and Bangladeshi banks linked to the financing of terrorists. Instead of prosecuting the bank, the head of the UK’s tax office went to work for it when he retired.

The Private Finance Initiative has been used by our governments to deceive us about the extent of their borrowing while channelling public money into the hands of corporations. Shrouded in secrecy, stuffed with hidden sweeteners, it has landed hospitals and schools with unpayable debts, while hiding public services from public scrutiny.

Monbiot reminds us that state police forces are alleged to have protected prolific paedophiles, including Jimmy Savile, and – it is now reported – a ring of senior politicians. The BBC has sacked many of those who sought to expose him while promoting people who tried to perpetuate the cover-up. He cites other forms of corruption:

  • our unreformed political funding system which permits the very rich to buy political parties;
  • the phone-hacking scandal and the payment of police by newspapers;
  • the underselling of Royal Mail;
  • the revolving door allowing corporate executives to draft the laws affecting their businesses;
  • the robbing of the welfare and prison services by private contractors;
  • price-fixing by energy companies;
  • daylight robbery by pharmaceutical firms and dozens more such cases.

Monbiot asks, “Is none of this corruption? Or is it too sophisticated to qualify?”

The power of global finance and the immense wealth of the global elite are founded on corruption, and the beneficiaries have an interest in framing the question to excuse themselves.

how corrupt britianA ground-changing book called How Corrupt is Britain?, edited by David Whyte, was recently published. It argues that narrow conceptions of corruption are part of a long tradition of portraying the problem as something confined to weak nations, which must be rescued by “reforms” imposed by colonial powers and, more recently, bodies such as the World Bank and the IMF. These “reforms” mean austerity, privatisation, outsourcing and deregulation and tend to suck money out of the hands of the poor and into the hands of national and global oligarchs.

Monbiot believes that How Corrupt is Britain? should be read by anyone who believes this country merits its position on the Transparency International’s corruption index.

The financial-political system is dysfunctional, entrenched, and abusive: Luyendijk

joris 2 luyendijkJoris Luyendijk writes the Guardian’s experimental Banking Blog, which looks at the world of finance from an anthropological perspective. He is a Dutch non-fiction author, who has worked as a Middle East journalist based in Egypt, Lebanon and the Palestinian territories. He also reported on the Second Gulf War in Iraq. His latest Guardian blog, recommended by a Dutch reader, is headed:

“Our banks are not merely out of control. They’re beyond control: Jailing reckless bankers is a dangerously incomplete solution. The market is bust. Institutions that are too big to fail are too big to exist.”

To summarise:

He sees global high finance – big banks, credit rating agencies and accountancy firms – as a set of interlocking cartels that divide the market among themselves and use their advantages to keep out competitors: “there just four major accountancy firms, they are also financially dependent on the very banks they are supposed to audit critically. It’s the same with the three credit-rating agencies dominating the market”.

Cartels spend profits on:

  • huge PR efforts;
  • a permanent recruiting circus drawing in top academic talent;
  • clever sponsoring of, say, an ambitious politician’s cycling scheme;
  • vast lobbying efforts behind the scenes;
  • highly lucrative second careers for ex-politicians;
  • offering talented regulators three or four times their salary.

Luyendijk proposes to restore market forces in a financial sector which would have smaller banks, smaller, independent accountancy firms and credit-rating agencies, simpler financial products and much higher capital requirements.

Before studying bankers he had reassuring images in his mind of well-dressed bankers and their lobbyists but now is “deeply pessimistic and genuinely terrified”, asking: “Surely at some basic level these people knew what they were doing?”

He concludes: “This system is highly dysfunctional, deeply entrenched, and enormously abusive, both to its own workers and the society it operates in. The problem really is exactly as bad as the ‘banker bashers’ believe”.


Read his article here.