Why put up with the ‘bandit’ in high office?

“MODERATE their greed.” This was the famous line attributed to then Economic Planning Secretary Romy Neri.
The story was about Neri instructing eventual whistle-blower Jun Lozada to persuade Benjamin Abalos and Mike Arroyo to lower their “commission” for brokering the National Broadband Network deal between the Chinese corporation ZTE and the Gloria Arroyo administration. Abalos, said Lozada, wanted $130 million from a contract worth $329 million, or a payoff equivalent to about 40% of the total.

 A bribe equivalent to 40% of the contract is a truly staggering amount. Yet the proportion of the “commission” to the total amount of the project that Abalos and company got would pale in comparison to what Janet Napoles and her principals grabbed. The pork barrel scam, amounting to P10 billion, was in many instances characterized by ghost projects. In other words, Napoles and the politicians pocketed all the money.

The greed of the Abalos and Napoles varieties is obviously excessive and outrageous. The people get shocked, and they will go out to the streets to condemn such corruption.

But what about “moderate greed?” It has been the norm since time immemorial. And even in the regime of Daang Matuwid, it exists — in local governments, revenue-collecting agencies, the police, regulatory bodies, etc.

The stark truth is people can tolerate “moderate greed.” (That is, so long as those involved in the corruption are not caught.) Some academic studies even conclude that corruption is an “efficient grease” to get things done in countries with weak institutions.

The late J. Edgardo Campos edited a volume titled The Boom and Bust of East Asia (2001), wherein he argued that even the high-level type of corruption (e.g., China) did not deter growth and investments in East Asia. What mattered was the predictability of corruption.

Thus, in a setting where extinguishing corruption is a pipe dream, the pragmatist can settle for low-level and predictable corruption.

Widely cited in economic literature is Mancur Olson’s distinction between the “roving bandit” and the “stationary bandit.” In his paper Dictatorship, Democracy, and Development (1993), Olson wrote this preface:

“Under anarchy, uncoordinated competitive theft by ‘roving bandits’ destroys the incentive to invest and produce, leaving little for either the population or the bandits. Both can be better off if a bandit sets himself up as a dictator — a ‘stationary bandit’ who monopolizes and rationalizes theft in the form of taxes. A secure autocrat has an encompassing interest in his domain that leads him to provide a useful order and other public goods that increase productivity.”

The stationary bandit, wrote Olson, “is not like the wolf that preys on the elk, but more like the rancher who makes sure that his cattle are protected and given water.”

Jejomar Binay fits the description of Olson’s stationary bandit. In Makati, despite being a “thief” as claimed by his former vice-mayor, Binay has given his constituents “the public goods that increase productivity,” including a modern hospital and free health care, free education, good roads, and even cakes and grocery items.

What about the bribe equivalent to 13% of the costs of projects? The 13% payoff is for the stationary bandit. Compare or contrast that to the greed of Abalos, Arroyo, Napoles, Juan Ponce Enrile, Jinggoy Estrada, and Ramon Revilla.

Should we then tolerate Binay for being a “stationary bandit”?

But why limit our choice to a bandit, roving or stationary? Why settle for a bandit, when in our midst we have virtuous politicians who stand for clean and progressive government, who feel the people’s pulse, and who have the smarts to make reforms work? They might be the minority, but they are most capable to lead the nation.

The goodness and other virtues of a new breed of intelligent politicians — the likes of Grace Poe and Leni Robredo — make a bandit like Binay despicable.

Filomeno S. Sta. Ana III coordinates the Action for Economic Reforms.

This article was first posted in BusinessWorld last September 15, 2014.
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