Bringing Order to the Fight Against Urban Corruption

Over the last three years, the media in Latin America has been offered a rich harvest of scandal. Brazil’s Lava Jato affair, involving the diversion of money from contracts at the state-run oil company to personal and party coffers, has led to more than 200 arrests and 80 convictions. A Guatemalan president and vice-president were driven from office over a multi-million dollar fraud case involving the custom’s administration. Those and many other cases have consumed television news programs and the print media alike.

But in focusing on national-level corruption, the media—and government too—has missed the equally important story of local corruption: the trash collectors who demand an extra payoff to do their jobs; the local government official who takes money to approve a questionable permit; the shakedown of suppliers participating in public procurements. Those daily incidents also undermine citizens’ faith in government and rule of law. But they garner little of the attention—and generate few of the movements for institutional reform—seen in the high-profile, national corruption cases.

There is, however, room for hope. At least part of the problem lies in the inability of local anti-corruption agencies to bring order to the numerous complaints they receive on a regular basis. Many of these agencies are unable to categorize complaints correctly so as to take a broad-sweeping, systemic approach to reform. This is why, years ago, I began to undertake an extensive look at the problem at the municipal level to find ways for the academic community to collaborate with local officials in combating corruption.

Urban corruption is severe in Latin America. The intense urbanization of the region, with more than 80% of the population living in cities, concentrates people into spaces where government services and regulatory agencies are often overburdened and vulnerable to abuse. Robert Klitgaard and co-authors have examined this issue.

An in-depth survey conducted by the Latin American Public Opinion Project (LAPOP) at Vanderbilt University also probes the problem. “Have you sought a permit in your municipality/borough in the last 12 months?” it asks. “And if you have done so, have you paid more than that required by law?”

Analyzing responses to that question in five moderately- to highly-urbanized countries of Latin America for 2012 and 2014 reveals that an average of 11% of the urban population has been victim of corruption. This is almost certainly an underestimate, as significant numbers of people are likely to have denied paying a bribe out of either fear of retaliation or shame at having engaged in illicit activity. But it does give a rough idea of the scale of the problem, with Peru (21%) showing the highest levels of urban corruption, followed by Mexico, Argentina, Brazil and Uruguay.

A significant number of people are evidently being asked to pay off officials in the course of routine activities. Beyond obtaining permits, these activities range from driving their cars to having their restaurants inspected and using public recreation spaces. Anti-corruption agencies need to act efficiently and aggressively; this, it seems, is not happening.

A talented team of researchers, which I oversee, is examining around 450 complaints received by an anti-corruption agency in an urban municipal government of Mexico. We find that many citizens are seemingly uninformed about what exactly corruption consists of and,  as a result, the agency is being over-burdened with inappropriate complaints. A parent denounces a state-run child care center for leaving his child semi-abandoned in the playground; a city employee alleges unfair treatment by her boss. These constitute misconduct in some form, but they are not instances of corruption.

More importantly, we find that anti-corruption agencies, often staffed by lawyers, tend to look at complaints inefficiently. They approach these individually, without separating complaints into categories and analyzing them in a way that would give the agencies a sense of where the problems are most dramatic and how each type of corruption might be attacked with reform.

We find, for example, that some complaints constitute neglect or a violation of official duties. These include bribery and kickback schemes, such as demanding a 10% payment on a public contract for the right to do business with the municipality. Another broad category involves administrative deficiencies, including tampering or destroying official documents; and red tape, as in holding up permits when all requirements have been fulfilled.

By dealing with such complaints exclusively on an individual basis, anti-corruption agencies are fumbling in the dark. In contrast, by imposing categories, as we are doing, agencies might bring order to their caseloads and gain perspective on how to target corruption vulnerabilities.

An anti-corruption agency that sees several complaints of so-called ghost employees—i.e., employees that collect paychecks without showing up for work—might require that the municipal government install fingerprint time clocks or conduct surprise visits to different offices in an effort to validate whether employees are actually present. A situation of unpaid contracts—suggesting that checks are issued only when an official gets bribed—might be contained by establishing strict procedures for determining the order in which different kinds of contracts are paid, rather than leaving the decision of how to manage scarce funds to individual discretion.

Such systematization is what academic institutions and specifically social scientists do well. It is a question of establishing trust between anti-corruption agencies and researchers. By handling the data with discretion and confidentiality, we hope to establish a precedent by which local governments around Latin America and beyond will be open to similar kinds of collaboration in the future.

It couldn’t be more urgent. Urbanization, expected to continue growing in the region, will only increase the opportunities for corruption at the local level. Heightened transparency, tougher enforcement of existing regulations, and better selection and pay of public servants might help. But local governments also need to get a handle on what kinds of corruption they have and where the attention needs to be placed so they can attack it in the most efficient and aggressive manner possible. That’s where we come in.

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The Author

Paul Lagunes

Paul Lagunes

Paul Lagunes is both a Visiting Scholar at the Inter-American Development Bank and an Assistant Professor at Columbia University’s School of International and Public Affairs. His research focuses on corruption, especially as it affects subnational governments in the Americas. Lagunes is currently studying corruption in infrastructure projects in Peru’s municipal governments, and teaches the master’s-level course “Local and Global Corruption: Maneuvering Toward Good Governance.” He obtained his Ph.D. in Political Science from Yale University.

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