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Across most of the world (and, as we see, in the US as well), it is expected - even required - for local officials to wet their beaks on fat contracts. If you want to sell a gas turbine or power plant or engineering services into India or Kazakhstan or Nigeria, paying off the local pols (and others) is necessary.
Of course, this is also illegal. The US and the EU selectively and sporadically enforce anti-bribery laws - often guided by whether or not that same company has been dutifully paying off the US/EU politicians as well. The whole thing stinks to high heaven. Trump's Executive Order yesterday tried to address this:
The president signs an executive order that says use of the Foreign Corrupt Practices Act has hurt American competitiveness
If you are in the business of building bridges or dams or pipelines, you find yourself in a predicament. Either you pay bribes or you don't win the contract, losing it to some other Western or Japanese company that chose a clever way to pay bribes and not get caught. And the clever ways can be very clever, indeed. For example, there are "local content" kickbacks for many contracts, including the requirement to buy parts or services from a local supplier in return for the national airline buying a 787 or A350 from Boeing/Airbus. These, in turn, become fungible ways to wet even more beaks across the land.
I hate corruption. But why should businesses be punished for playing by the local rules?
So here's my thought: what if companies can only be held civilly/criminally liable in the countries in which they pay the bribes? So Siemens is not punished in Europe for paying off the Egyptian government for work on civilian infrastructure. Instead, they have to deal with Egyptian law and enforcement? If Egypt has corruption, then it is an Egyptian problem, and every company has the same opportunities and risks.
Is this more ethical? Is it more right?
Discussion (13)
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I am given to understand that a lot of trouble with our rebuilding efforts in Iraq and Afghanistan was due to not understanding the nature of business relationships in tribal societies. Trying to apply our rules led to confusion and ultimately dissatisfaction on everyone’s part.
I also believe that lots of what DOGE is uncovering relative to USAID and NGO’s is a form of what you describe as clever ways to redefine bribes.
One other thought is that despite public corruption in the US, I think we as a society all agree that it’s a bad thing. Yet absorbing millions of immigrants from societies where it’s ubiquitous can’t end well.
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Could we think of bribes as another sort of tariff? An added cost a purchasing country adds to their own commerce for their own reasons.
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Businesses put up with a lot of shady practices like that. I have to laugh at our current pragmatist president's executive order on this. This is a guy who has built buildings all over the world. If anyone knows how the world works, it's Trump. Sometimes you have to play the kickback game. I'm sure he has a good reason for issuing this order.
That said, it goes without saying that there have to be some controls. Bribery should never be allowed in guns, military arms of any kind, drugs, or human trafficking. It shouldn't be used to prop up evil dictators or fund Hamas operations.
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Either repeal the law, or enforce it. If Trump decides not to enforce it, companies and individuals are still at risk that a successor administration will enforce it up to the statute of limitations. For example, an infraction ignored by the Trump DOJ in year 4 of his term could still be charged in year one of the following president's term. Either repeal the law, or enforce it.
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It is wrong to induce people to breach their duties. It is dangerous for companies to indulge in this sort of activity, as the corruption has a tendency to undermine the morals of the business as a whole.
It is also wrong to have laws that are selectively enforced, or can be selectively enforced. This undermines the rule of law.
Just because something is wrong doesn’t mean there should be a law against it.
If there is a law against it, either repeal the law or enforce it.
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