The Stench of Corruption

The Stench of Corruption

A righteous wind is sweeping across Europe and corruption is being exposed all over.


A righteous wind is sweeping across Europe and corruption is being exposed all over. I do not mean, say, in Russia, where an entirely new system and changing property relations offer golden opportunities to speculators. (I read in Izvestia, I believe, that Anatoly Chubais, now First Deputy Prime Minister but hitherto in charge of privatization, is allegedly the fifth-richest man in the country.) I mean in steady, prosperous, respectable Western Europe. In Italy, where the purge brought the old regime down, the Prime Minister of the new one is now under investigation. In France, ministers tumble and tycoons tremble. In Spain, the escaped former head of the Civil Guard is still, mysteriously, in hiding, while in Britain you can find the going rate for a representative asking your question in Parliament. Everywhere you look it’s scandals, sleaze and putrefaction.

Naturally, our period is not unique. France, for instance, was shaken by the Panama Canal scandal in the 1890s and the Stavisky affair in the 1930s, to name only the most striking examples. But the revelations of sins and campaigns of indignation are usually significant symptoms. What is wrong with our political life that judges and prosecutors, aided and abetted by the press, are the new sheriffs, upholders of justice? Has the corruption spread because the cost of politics has gone up in our Americanized, television-infested société du spectacle? (Incidentally Guy Debord, the Situationist author of the book with this title, committed suicide on November 30.) Or is the growing stench the sign of a deeper decay, heralding the end of a reign? These are the questions that must be tackled once you have been brought up-to-date on the fast-changing saga of scandals.

Sleaze International

In Italy the problem seems to be how to stop the judicial machine. The mincer has already done more than it was supposed to do–swallowing parties, smashing institutions, breaking business tycoons–yet it keeps on going. That is not really surprising since the cleansing, the mani pulite, affected only the political superstructure, leaving the foundations of society unchanged, and it anointed as champion of the new deal Silvio Berlusconi, a product and profiteer of the old one. The comic climax of the campaign was reached at the end of November in Naples, when Prime Minister Berlusconi, pre siding over a U.N. conference on the struggle against organized crime, was served notice that he was being investigated on suspicion of having bribed tax inspectors in his capacity as head of his vast conglomerate Fininvest.

For once, the famous magistrates of Milan may have made a mistake. Not that they attacked without ammunition. They have probably stocked a number of shells in their armory. But they switched the battle to the legal ground at a time when the Prime Minister was in trouble on the social and political fronts. Last March, you may recall, Berlusconi was swept into office as Mr. Bountiful as well as Mr. New’ Deal. He promised a million new jobs and no new taxes. While the jobs cannot be seep on the horizon, the Italians have been told to tighten their belts further. In order to cut the deficit, the government seems determined to slash social expenditures, starting with pensions in the current budget. People reacted to this attack on the welfare state through strikes and mass demonstrations. According to my Italian friends, the mood among the rank and file has not been s o militant since the sixties. The government is also paying a political price. In the November and December local elections, the three-party governing coalition suffered a serious setback. The National Alliance of the neo-Fascist Gianfranco Fini held its ground. The Northern League of Umberto Bossi, the most awkward ally, did not do as badly as expected. The real collapse was that of Berlusconi’s own makeshift party, Forza Italia.

At this point a shift to the judicial arena helped Berlusconi. He could argue that judges wanted to bring down the leader elected by the people. He then struck a last-minute deal with the labor unions by separating the pensions scheme from the budget. He managed to hold his coalition together, but the state of grace is plainly over. It is not clear how long Berlusconi will last and who can take over. It is even less obvious how the purging machine is going to be put to a stop. The resignation on December 6 of Antonio Di Pietro, the most famous of the Milan prosecutors, ends neither the mani pulite campaign nor the confrontation with Berlusconi. Indeed, it may mark the beginning of Di Pietro’s political career.

There can be no takers without givers; these are mainly businesses seeking contracts. In France, at this stage, the problem is how to slow down the process. The last time we looked at the scene [see Singer, “Brightness at Midnight?” September 5/12], only the Minister of Communications, Alain Carignon, was under investigation. He had to resign and is now in jail awaiting trial. Then Prime Minister Edouard Balladur tried to shelter Minister of Industry Gérard Longuet, important to Balladur’s presidential aspirations. In vain, Longuet is now out of government and is being investigated for shady deals involving his personal finances and those of his Republican Party. He was followed out of office by the Minister of Overseas Cooperation, accused of having illegally acted as an intermediary between private companies and the Paris town hall. Rumors in Paris have it that there are more scandals to come.

Where there are takers there are givers. The scandals have revealed who are the biggest donors of funds, official and unofficial, to party politics. They are essentially businesses working for town and regional authorities, building roads, schools and stadiums and supplying water and heating. Pride of place is taken by two water companies–the Générale des Eaux and the Lyonnaise des Eaux, two conglomerates involved in all sorts of enterprises, including cable television–and by Bouygues, the public works giant and owner of the country’s biggest television network, TFl. The fact that a few prosecutors, breaking a taboo, dared to incriminate and even imprison people at the very top spread panic in the boardrooms.

The government and Parliament are now offering competing anticorruption programs, both of which mainly tighten laws passed by the Socialists at the turn of the decade after the discovery of their own scandals. Those involved setting fairly low ceilings on campaign spending ($100,000 for a parliamentary candidate, $24 million for a presidential hopeful and $32 million for the two lucky survivors into the second ballot) and placing limits on business contributions and stricter controls on bidding for contracts with state or local authorities (decentralization had widened the scope for graft at the local level). It is now being suggested that the ceilings should be lowered still further and that business, as opposed to individual, contributions should be forbidden altogether for a trial period. But the question of raising the levels of public funding for party and electoral expenses, which would reduce the need to solicit private funding, has yet to be addressed.

Reformist zeal is spurred when the interests of the mighty are threatened. After the arrests of many prominent and wealthy figures, it has suddenly been discovered that preventive detention is being used too frequently, that something urgently needs to be done to shorten the now-lengthy period between the original indictment and trial, that the presumption of innocence is being trampled on by a press that publishes chunks of the incriminating evidence while the matter is sub judice. These are important and complex issues. The snag is that they were neglected as long as the humble were paying the price. What we see now is the establishment defending its own and the ruling coalition fighting for its political survival. The stench of corruption coupled with the internecine struggle between rival candidates on the political right had entirely altered the prospects for next spring’s presidential election. What looked like a foregone conclusion, with Balladur a certain winner, became for a while an open race. Then, on December 11, the unexpected decision of Jacques Delors not to stand as the candidate of the left altered the equation once again: Now the Socialists have no candidate and the right too many.

In Spain, 1994 has been the year of the embezzlers. No wonder, since, in addition to the already mentioned head of the Civil Guard, a former governor of the Bank of Spain and a former head of the Madrid stock exchange were arrested for tax evasion, and two key merchant bankers were indicted for fraud. Three Spanish ministers, too, had to depart under a cloud of suspicion, though the recent attempt by the newspaper El Mundo to accuse the Prime Minister, Felipe Gonzalez, of bestowing favors on his brother-in-law misfired. Politically, Spain is now at the stage, France was a few years ago-the moral discrediting of the ruling left. There, too, the Socialists have shown that, once converted to the religion of profit, they need no lessons from anyone on how to line their pockets.

The light touch has been added by the British. A quarrel between Mohamed al-Fayed, the Egyptian-born owner of Harrods, the posh Knightsbridge store, and the Tory party revealed that he used to pay just over $3,000–including the commission of the P.R. firm that acted as go-between–to bribe Members of Parliament to ask questions in the House of Commons: Seventeen questions were asked on the Harrods takeover alone. All-Fayed also paid about $6,500 for the stay at the Ritz in Paris of Neil Hamilton and his wife; Hamilton was one of the two junior ministers forced to resign because of the scandal. He was, by the way, in charge of ethics at the Department of Trade and Industry.

Some British commentators used the case as evidence of Britain’s moral superiority: The money involved was peanuts and the men were punished because Britain is alone in Europe in having a real register of members’ potential conflicts of interest. To which it may be replied that, when real money is involved–say the nearly $19 million commission that Mark Thatcher, the son of the Iron Lady, is alleged to have obtained in a famous British arms deal with Saudi Arabia–the case does not get to court or before a parliamentary commission of inquiry. Legal does not mean moral. Still, it may be argued that the British, like the Americans, have long ago admitted the rule of money and codified its reign with registers of lobbyists and special-interest groups. European countries have tried to conceal this dictatorship with a veil of hypocrisy, which is now being torn apart.

Money Unadorned

The face of continental Europe is changing, As in a western, the main actors are lonely heroes, brave men defending principles, namely, judges and public prosecutors. They are helped by journalists willing to defy the authorities. The political parties enter the stage last, as a sort of belated fire brigade, driven to action by popular pressure. This picture reflects a general postwar trend: the diminution of the power of Parliament, of elected assemblies and of political parties. This tendency, however, has been greatly accelerated in the last dozen years or so by the spread of consensus politics in continental Europe.

It is as if the Establishment had decided to grant greater license to its critics, since the nature of the system itself was no longer being questioned by them. Indeed, investigative journalism has developed in Europe at a time when reporters–and political parties–no longer challenge the very foundations of society. Similarly, it was thought that the judges were not too dangerous, since they fought for the scrupulous application of the law and not for its radical transformation. I am not hankering for an obedient press and magistrates standing at attention. It is splendid to read disrespectful journalists and watch judges daring to challenge the mighty. Yet it is not their role to change society on their own, When parties and politicians are lumped together as rotten, when all the institutions are damned without a genuine popular movement offering a more democratic alternative, charlatans, national saviors and the extreme right are usually the beneficiaries. The success of Fini-Berlusconi illustrates the point.

But why so much graft now? As Italians will tell you, corruption goes back to the Romans, but the degree of it varies. The 1980s saw a qualitative change, partly because of the rising cost of political campaigns. True, candidates still cannot sway elections in Europe by a massive blitz of paid political spots; in most countries such ads are forbidden. And we were staggered by the exorbitant expenditure in the recent American elections, notably in Texas and California. Nevertheless, our own costs did go up and the practice of politics changed in the process. Left-wing parties, which used to rely on dues and the militancy of their members, suffered the most, Door- to-door canvassing and meetings in schoolyards and small halls were rapidly replaced by big shows with stars to attract an audience and the TV cameras. Money was needed to pay for all that. Some politicians cheated only for the party. Others filled their own pockets.

Yet the broader reason for the change of the political climate has been money’s penetration into all walks of life and its ideological victory. By the eighties, the logic of capital was triumphant. Your value was your salary or rather your income, earned or unearned. You were worth what you could get, by hook or by crook. When you argued that in a highly unequal society there was a bias in favor of parties representing the wealthy, you were answered in London that the employers finance one side and the unions the other. This was a good guide to the fundamental nature of our system. Its basic principle is not one person, one vote. One employer equals umpteen employees, and this is bound to have its effect on political and electoral results.

The eighties were not only the decade of privatization. They saw a frontal attack on the very idea of a different approach to public or, better still, social service. People were being persuaded that the post office, the railways, the schools and the hospitals can be run only on commercial lines. Take the horrible French case of HIV-contaminated blood knowingly being distributed to hemophiliacs. It has been hinted that this happened because the French blood transfusion office was run by the government. Actually, this tragedy proves exactly the opposite. It happened because the public service was run as if it were private. The guilty ones committed a crime because their categorical imperative was profit-making.

The ruthless application of capitalist logic is meeting resistance. The revolt, however, is still against the “abuses” rather than the system itself. We must welcome all the attempts to curb the power of money–ceilings on campaign spending, controls over contracts and contributions. We must do so, however, without illusions. In a highly unequal society, money will always manage to prevail. Our age is the epoch of the highest, and it is hoped last, stage of capitalism. The reign of profit is now not only spreading to the farthest corners of the earth. It has penetrated every nook and cranny of our society–sports, culture, love. As I ponder the fundamental cause of the current stench and revulsion, the chorus of a hackneyed postwar song trots through my mind, the words almost literally pinched from the New Testament: Money is the root of all evil, the religion of profit is the cause of our putrefaction.

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Katrina vanden Heuvel
Editorial Director and Publisher, The Nation

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