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Neoliberal corruption bulletin, 2015

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[Dec 17, 2015] Ex-House Speaker Dennis Hastert legal issues

economistsview.typepad.com
In October, Hastert, 73, entered a guilty plea to a single felony count of evading bank reporting laws by withdrawing about $950,000 in cash in increments of less than $10,000. Prosecutors contend he used the money to conceal his "misconduct" with a longtime associate. Court filings are silent on the nature of the relationship, but sources say it involved sexual contact with a former student at the high school where Hastert served as a wrestling coach and teacher before entering politics. He has not responded publicly to those allegations.

Hastert is set to be sentenced on the banking charge on February 29, but that could be delayed if his health woes continue. Prosecutors and defense lawyers have agreed that sentencing guidelines call for him to receive between zero and six months in prison.

im1dc, December 17, 2015 at 01:23 PM

Ex-House Speaker Dennis Hastert legal issues - 1h ago

"Former House Speaker Dennis Hastert suffered stroke, has been hospitalized for about 6 weeks, his lawyer says - @politico"

Read more on politico.com

im1dc -> im1dc...

Ya gotta ask yourself this: If Jared Fogle of Subway infamy is going away to Prison for his fiddling with the underage why has Dennis Hastert escaped felony conviction for his diddling with at least one underaged teen boy and probably three of them and getting caught paying the guy for years to cover it up?

Something is clearly wrong with the US Justice when the high and mighty, current D.C. Lobbyist, formerly 3rd most powerful politician in America, and still well connected politically his connections in the government stay out of prison when prison is where America wants criminals like him and Jared Fogle.

[Dec 17, 2015] A symbol of defiant greed arrested for security fraud

Notable quotes:
"... Martin Shkreli, the boyish drug company entrepreneur, who rocketed to infamy by jacking up the price of a life-saving pill from $13.50 to $750, was arrested by federal agents at his Manhattan home early Thursday morning on securities fraud related to a firm he founded. ..."
"... Shkreli, 32, ignited a firestorm over drug prices in September and became a symbol of defiant greed. ..."
"... His arrest, witnessed by Reuters, comes amid a continuing separate controversy that has turned Shkreli into a lightning rod for growing outrage over the soaring prices of prescription drugs. ..."
economistsview.typepad.com
Fred C. Dobbs said... December 17, 2015 at 07:57 AM
Pharma CEO Martin Shkreli arrested on charges of securities
fraud http://www.bloomberg.com/features/2015-martin-shkreli-securities-fraud/
Bloomberg - Christie Smythe and Keri Geiger - December 17

32-year-old suspected of plundering Retrophin to pay debts

Martin Shkreli, the boyish drug company entrepreneur, who rocketed to infamy by jacking up the price of a life-saving pill from $13.50 to $750, was arrested by federal agents at his Manhattan home early Thursday morning on securities fraud related to a firm he founded.

Shkreli, 32, ignited a firestorm over drug prices in September and became a symbol of defiant greed. The federal case against him has nothing to do with pharmaceutical costs, however. Prosecutors in Brooklyn charged him with illegally taking stock from Retrophin Inc., a biotechnology firm he started in 2011, and using it to pay off debts from unrelated business dealings. He was later ousted from the company, where he'd been chief executive officer, and sued by its board.

In the case that closely tracks that suit, federal prosecutors accused Shkreli of engaging in a complicated shell game after his defunct hedge fund, MSMB Capital Management, lost millions. He is alleged to have made secret payoffs and set up sham consulting arrangements. A New York lawyer, Evan Greebel, was also arrested early Thursday. He's accused of conspiring with Shkreli in part of the scheme.

Retrophin replaced Shkreli as CEO "because of serious concerns about his conduct," the company said in a statement. The company, which hasn't been accused of any wrongdoing, has "fully cooperated with the government investigations into Mr. Shkreli." ...

Fred C. Dobbs said in reply to Fred C. Dobbs...
Turing Pharma CEO Martin Shkreli arrested
http://www.trust.org/item/20151217115340-g99u8

Dec 17 (Reuters) - Pharmaceutical entrepreneur Martin Shkreli was arrested by the FBI on Thursday, amid a federal investigation related to his former hedge fund and a drug company he previously headed.

The previously disclosed investigation of Shkreli, 32, who is now chief executive of Turing Pharmaceuticals, stemmed from his time as manager of hedge fund MSMB Capital Management and chief executive of biopharmaceutical company Retrophin Inc .

His arrest, witnessed by Reuters, comes amid a continuing separate controversy that has turned Shkreli into a lightning rod for growing outrage over the soaring prices of prescription drugs.

[Dec 09, 2015] How Hillary Clinton Abused Her State Department Role To Help Her Hedge Funder Son-In-Law Zero Hedge

Notable quotes:
"... Most importantly, as DC concludes, the email shows that people close to Clinton had the inside track in pushing her their pet projects - a pattern that has been on display with nearly every monthly release of Clinton emails. ..."
www.zerohedge.com

While Hillary Clinton may have had some entertaining problems when using her Blackberry (or was that iPad) as US Secretary of State, one thing she excelled at was nepotism.

According to the latest set of emails released by the State Department, and first reported by the Daily Caller, Hillary intervened in a request forwarded by her son-in-law, Marc Mezvisnky, on behalf of a deep-sea mining firm, Neptune Minerals, to meet with her or other State Department officials.

One of the firm's investors, Harry Siklas who was Mezvinsky's coworker at Goldman (which donated between $1 and $5 million to the Clinton Foundation) had asked Mezvinsky, who married Chelsea Clinton in 2010 and who currently runs his own hedge fund (in which Goldman CEO Blankfein is also an investor) for help setting up such contacts, an email from May 25, 2012 shows.

Siklas told Mezvinsky that Neptune Minerals (a company founded by one of Siklas' close friends) was poised for great things. He also touted an investment that Goldman Sachs - had made in the company, which had underwater tenements in the South Pacific.

Siklas said that he and Adam hoped to meet with State Department officials, including Clinton, to discuss deep sea mining "and the current legal issues and regulations" surrounding it.

"I introduced them to GS and the bankers took them on as a client," Siklas wrote.

"There is a favor I need to ask, and hopefully it will not put you out, as I'm not one to ask for favors typically," Siklas wrote to Mezvinsky. "I need a contact in Hillary's office."

"Siklas said that he and Adam hoped to meet with State Department officials, including Clinton, to discuss deep sea mining "and the current legal issues and regulations" surrounding it.

As AP adds, the lobbying effort on behalf of Neptune Minerals came while Hillary Clinton - now the leading Democratic presidential candidate - was advocating for an Obama administration push for Senate approval of a sweeping Law of the Sea Treaty. The pact would have aided U.S. mining companies scouring for minerals in international waters, but the Republican-dominated Senate blocked it.

Clinton then ordered a senior State Department official, Thomas Nides and now a vice chairman at Morgan Stanley, to look into the request in August 2012.

"Could you have someone follow up on this request, which was forwarded to me?" Clinton asked Nides.

Nides replied: "I'll get on it."

The emails do not show whether Clinton or other State Department officials met with Harry Siklas or with executives from the Florida-based firm. Clinton's official calendars, recently obtained by The Associated Press, also do not show any meetings between Clinton and Neptune representatives.

Clinton's campaign declined through a spokesman to discuss the issue, despite AP asking detailed questions about the matter since Nov. 30. The AP attempted to reach Siklas and a Neptune executive, Josh Adam, by phone, email and in-person visits to their homes last week but received no replies.

As noted above, Siklas had said in his email that his then-employer, Goldman Sachs, was representing Neptune.

Unperturbed by the State Department's stonewalling, AP then dug deeper into its quest to see just how extensive the nepotism ran:

A spokesman for Eaglevale said Mezvinsky would not comment on his role. Emails to a spokeswoman for Chelsea Clinton went unreturned. Morgan Stanley officials did not respond to an AP request to interview Nides. The AP also left three phone messages with Neptune Minerals' office in St. Petersburg, Florida, and also left several phone and email messages with Hans Smit, the firm's current president, also with no reply.

Federal ethics guidelines warn government employees to "not give preferential treatment to any private organization or individual," but there are no specific provisions prohibiting officials from considering requests prompted by relatives.

As the AP then notes, "Clinton's willingness to intercede as a result of her son-in-law's involvement is the latest example of how the Clinton family's interests cut across intersecting spheres of influence in American politics, commerce and charity."

There's more:

A lawyer for an environmental group opposing deep-sea mining said Clinton's action was "cause for concern that the State Department might take any action that could encourage such activity." Emily Jeffers, an attorney for the Center for Biological Diversity, a group opposing deep-sea mining, filed suit against Commerce Secretary Penny Pritzker and the National Oceanic and Atmospheric Administration last May, accusing the agencies of failing to conduct comprehensive environmental tests before licensing Lockheed Martin Corp. to mine for minerals in U.S. territorial waters in the Pacific Ocean.

Jeffers said her organization supports the Law of the Sea Treaty that Clinton championed during her tenure at the State Department. She said the proposal would give the U.S. and other countries roles in establishing standards to explore for oil, gas and minerals. Jeffers said her group worries that the U.S. and other commercial nations will encourage deep-sea mining once the treaty is adopted.

One provision of the treaty, backed by corporate interests, would allow nations, including the U.S., to sponsor mining companies seeking to scour deep seas for minerals. Clinton told senators in May 2012 that American mining firms would only be able to compete freely against foreign rivals under standards set by the treaty.

Seabed mining is "very expensive, and before any company will explore a mine site, it will naturally insist on having a secure title to the site and the minerals it will recover," she said.

Clinton's public push for a U.S. role in securing deep sea mining rights quickly hit home at Neptune Mining. Three days after her Senate appearance, Siklas, who described himself as a "passive investor" in Neptune, emailed Mezvinsky.

As Siklas explained to Clinton's son in law, Neptune was pursuing sea-floor massive sulfide (SMS) mining in the South Pacific and had just bought out two other mining firms. Siklas said that he and Adam needed "a contact in Hillary's office: someone my friend Josh (and I perhaps) can reach out via email or phone to discuss SMS mining and the current legal issues and regulations." Siklas, then registered as a stockbroker at Goldman Sachs in New York, had contributed $2,000 to Hillary Clinton's 2008 unsuccessful presidential bid.

Siklas said the State Department would be interested in the subject following Clinton's Senate testimony. He said he and Adam "would feel very fortunate to have someone's ear on this topical issue, with the hope that at some point we get in front of the secretary herself."

And since the emails do not show how Clinton became directly aware of Siklas' email to Mezvinsky or why it took three months for her to act after Mezvinsky became involved, it also raises questions how many emails in the chain had been illegally deleted, and what may be contained in them. As the Daily Caller observes:

... it is unclear why there is no record of Clinton being forwarded the email that Siklas sent to Mezvinsky. Clinton wrote in her email to Nides that she was forwarded the email from Siklas to her son-in-law. If Clinton had turned over all work-related emails that she has sent or received - as she has repeatedly claimed - it would be expected that she had an email sent directly to her inbox with Siklas's email attached.

The answer is simple: Clinton did not in fact produce all emails as had been demanded. But while the emails do not show a reply from Mezvinsky, Hillary Clinton eventually obtained a copy and sent it to Nides that August, ordering a follow-up.

Most importantly, as DC concludes, the email shows that people close to Clinton had the inside track in pushing her their pet projects - a pattern that has been on display with nearly every monthly release of Clinton emails.

For those who are shocked, feel free to read what little evidence Clinton did provide of just that, shown below.

[Dec 08, 2015] Nepotism and corruption on high levels of US government

Notable quotes:
"... As Vice President Joseph R. Biden Jr. aims to curb corruption in Ukraine, his son, Hunter, sits on the board of a Ukrainian company that the American ambassador has accused of having illicit assets. ..."
"... What is he, sort of a wayward, neer-do-well playboy type? Not really. Hes a graduate of Yale Law School and a former senior vice-president at MBNA America Bank. Good for him. During the Clinton administration he worked in the US Department of Commerce. Hes presently a partner in an investment firm. And counsel for a national law firm. And an adjunct professor at Georgetown University. I get it: he likes to keep busy. He has even found the time to join the board of a gas company called Burisma Holdings Ltd. Never heard of it. Perhaps thats because its a Ukrainian gas company; Ukraines largest private gas producer, in fact. Hes taking charge of the companys legal unit. Isnt that a bit fishy? Why do you say that? Because hes the vice-presidents son! Thats a coincidence. This is totally based on merit, said Burismas chairman, Alan Apter. ..."
"... Who? Devon Archer, who works with Hunter Biden at Rosemont Seneca partners, which is half owned by Rosemont Capital, a private equity firm founded by Archer and Christopher Heinz. ..."
"... Who? Christopher Heinz … John Kerrys stepson. ..."
"... I think Putins propaganda people can take a long weekend; their work is being done for them. ..."
economistsview.typepad.com
anne said... Tuesday, December 08, 2015 at 10:30 AM
http://www.nytimes.com/2015/12/09/world/europe/corruption-ukraine-joe-biden-son-hunter-biden-ties.html

December 8, 2015

Biden, His Son and the Case Against a Ukrainian Oligarch
By JAMES RISEN

As Vice President Joseph R. Biden Jr. aims to curb corruption in Ukraine, his son, Hunter, sits on the board of a Ukrainian company that the American ambassador has accused of having "illicit assets."

anne said in reply to anne...
http://www.theguardian.com/business/shortcuts/2014/may/14/hunter-biden-job-board-ukraine-biggest-gas-producer-burisma

May 14, 2014

Why shouldn't Hunter Biden join the board of a gas company in Ukraine?
The son of the US vice-president has been chosen to take charge of energy firm Burisma's legal unit – a decision based purely on merit, of course.

Name: Hunter Biden.

Age: 44.

Appearance: Chip off the old block.

His names rings a bell. Is he related to someone famous? He's the son of Joe Biden, the US vice president.

What is he, sort of a wayward, ne'er-do-well playboy type? Not really. He's a graduate of Yale Law School and a former senior vice-president at MBNA America Bank. Good for him. During the Clinton administration he worked in the US Department of Commerce. He's presently a partner in an investment firm. And counsel for a national law firm. And an adjunct professor at Georgetown University. I get it: he likes to keep busy. He has even found the time to join the board of a gas company called Burisma Holdings Ltd. Never heard of it. Perhaps that's because it's a Ukrainian gas company; Ukraine's largest private gas producer, in fact. He's taking charge of the company's legal unit. Isn't that a bit fishy? Why do you say that? Because he's the vice-president's son! That's a coincidence. "This is totally based on merit," said Burisma's chairman, Alan Apter.

He doesn't sound very Ukrainian. He's American, as is the other new board member, Devon Archer.

Who? Devon Archer, who works with Hunter Biden at Rosemont Seneca partners, which is half owned by Rosemont Capital, a private equity firm founded by Archer and Christopher Heinz.

Who? Christopher Heinz … John Kerry's stepson.

I think Putin's propaganda people can take a long weekend; their work is being done for them. What do you mean?

Hasn't Joe Biden pledged to help Ukraine become more energy independent in the wake of its troubles with Russia? Well, yes.

And isn't Burisma, as a domestic producer, well positioned to profit from rising gas prices caused by the conflict? Possibly, but Hunter Biden is a salaried board member, not an investor. According to anonymous sources in the Wall Street Journal, neither Rosemont Seneca nor Rosemont Capital has made any financial investment in Burisma.

So it's not fishy at all? No one's saying that.

Do say: "Somebody needs to get involved in Ukraine's corporate governance, and it might as well be a clutch of rich, well-connected American dudes with weird first names."

Don't say: "Thanks, Dad."

-- Guardian

[Dec 02, 2015] When it comes to Wall Street buying our democracy you just need to follow the money

Notable quotes:
"... Let's compare donations from people who work at Bank of America, JP Morgan Chase, Morgan Stanley, Wells Fargo, Citigroup and Goldman Sachs to Hillary Clinton and Bernie Sanders. Hillary Clinton, has received $495,503.60 from people who work on Wall Street Bernie Sanders, has received only $17,107.72. Hillary Clinton may have Wall Street, ..."
"... The false promise of meritocracy was most disappointing. It basically said that meritocracy is hard to do, but never evaluates whether it is the right thing to do. Hint - it isn't enough. We need to worry about (relative) equality of outcome not just (relative) equality of opportunity. An equal chance to starve is still an equal chance. ..."
"... Making economies games is how you continued rigged distribution apparatus. Question all "rules"! ..."
economistsview.typepad.com

RGC, December 02, 2015 at 05:55 AM

Bernie's latest pitch:

When it comes to Wall Street buying our democracy, you just need to follow the money. Let's compare donations from people who work at Bank of America, JP Morgan Chase, Morgan Stanley, Wells Fargo, Citigroup and Goldman Sachs to Hillary Clinton and Bernie Sanders. Hillary Clinton, has received $495,503.60 from people who work on Wall Street Bernie Sanders, has received only $17,107.72. Hillary Clinton may have Wall Street, But Bernie has YOU! Bernie has received more than 1.5 million contributions from folks like you, at an average of $30 each.

pgl -> RGC, December 02, 2015 at 05:58 AM
$17,107.72? Jamie Dimon spends more than that on his morning cup of coffee. Go Bernie!
EMichael -> RGC, December 02, 2015 at 06:03 AM
To be fair, don't you think we should count donations for this election cycle for Clinton?

Y'know, she was the Senator from New York.

pgl -> EMichael,
Some people think anyone from New York is in bed with Wall Street. Trust me on this one - not everyone here in Brooklyn is in Jamie Dimon's hip pocket. Of course those alleged liberals JohnH uses as his sources (e.g. William Cohan) are in Jamie Dimon's hip pocket.
EMichael -> pgl,
I hate things like this. No honesty whatsoever. This cycle.

http://www.opensecrets.org/pres16/contrib.php?cycle=2016&id=N00000019

RGC -> EMichael,
How is there no honesty whatsoever?

The total for Morgan Stanley, JP Morgan and Bank of America is $326,000.
That leaves Wells Fargo, Citigroup and Goldman Sachs to contribute $169,000.

EMichael -> RGC,
I stand corrected, somewhat.

Let me know how much comes from those organizations PACs.

reason said,
The false promise of meritocracy was most disappointing. It basically said that meritocracy is hard to do, but never evaluates whether it is the right thing to do. Hint - it isn't enough. We need to worry about (relative) equality of outcome not just (relative) equality of opportunity. An equal chance to starve is still an equal chance.
ilsm -> reason,

Making economies games is how you continued rigged distribution apparatus. Question all "rules"!

von Neumann should have been censored.

[Dec 02, 2015] When it comes to Wall Street buying our democracy you just need to follow the money

Notable quotes:
"... Let's compare donations from people who work at Bank of America, JP Morgan Chase, Morgan Stanley, Wells Fargo, Citigroup and Goldman Sachs to Hillary Clinton and Bernie Sanders. Hillary Clinton, has received $495,503.60 from people who work on Wall Street Bernie Sanders, has received only $17,107.72. Hillary Clinton may have Wall Street, ..."
"... The false promise of meritocracy was most disappointing. It basically said that meritocracy is hard to do, but never evaluates whether it is the right thing to do. Hint - it isn't enough. We need to worry about (relative) equality of outcome not just (relative) equality of opportunity. An equal chance to starve is still an equal chance. ..."
"... Making economies games is how you continued rigged distribution apparatus. Question all "rules"! ..."
economistsview.typepad.com

RGC, December 02, 2015 at 05:55 AM

Bernie's latest pitch:

When it comes to Wall Street buying our democracy, you just need to follow the money. Let's compare donations from people who work at Bank of America, JP Morgan Chase, Morgan Stanley, Wells Fargo, Citigroup and Goldman Sachs to Hillary Clinton and Bernie Sanders. Hillary Clinton, has received $495,503.60 from people who work on Wall Street Bernie Sanders, has received only $17,107.72. Hillary Clinton may have Wall Street, But Bernie has YOU! Bernie has received more than 1.5 million contributions from folks like you, at an average of $30 each.

pgl -> RGC, December 02, 2015 at 05:58 AM
$17,107.72? Jamie Dimon spends more than that on his morning cup of coffee. Go Bernie!
EMichael -> RGC, December 02, 2015 at 06:03 AM
To be fair, don't you think we should count donations for this election cycle for Clinton?

Y'know, she was the Senator from New York.

pgl -> EMichael,
Some people think anyone from New York is in bed with Wall Street. Trust me on this one - not everyone here in Brooklyn is in Jamie Dimon's hip pocket. Of course those alleged liberals JohnH uses as his sources (e.g. William Cohan) are in Jamie Dimon's hip pocket.
EMichael -> pgl,
I hate things like this. No honesty whatsoever. This cycle.

http://www.opensecrets.org/pres16/contrib.php?cycle=2016&id=N00000019

RGC -> EMichael,
How is there no honesty whatsoever?

The total for Morgan Stanley, JP Morgan and Bank of America is $326,000.
That leaves Wells Fargo, Citigroup and Goldman Sachs to contribute $169,000.

EMichael -> RGC,
I stand corrected, somewhat.

Let me know how much comes from those organizations PACs.

reason said,
The false promise of meritocracy was most disappointing. It basically said that meritocracy is hard to do, but never evaluates whether it is the right thing to do. Hint - it isn't enough. We need to worry about (relative) equality of outcome not just (relative) equality of opportunity. An equal chance to starve is still an equal chance.
ilsm -> reason,

Making economies games is how you continued rigged distribution apparatus. Question all "rules"!

von Neumann should have been censored.

Quest for a Narrative Representation of Power Relations

naked capitalism
He found the nodal points. Sometimes, falling asleep in Santa Monica, he wondered vaguely if there might be a larger system, a field of greater perspective. –William Gibson, Idoru

Representation is the essence of social engineering. –Fred Brooks, adapted

By Lambert Strether of Corrente.

Last April, I was enchanted by a diagram of the "web of corruption" surrounding New Jersey Governor and Republican Presidential candidate Chris Christie, which the New York Times coyly labels "the Lane Closings," but which you and I know as BridgeGate. I encourage you to go view the original article at full size, and spend a little time reading it. This is the diagram, created by Bill Marsh and Kate Zernike:

Figure 1: Christie's Web of Corruption

1_full_times_christie

You can see how it would be interesting and even useful to map the webs of corruption surrounding Jebbie, or Hillary Clinton, or even Donald Trump; each of these candidates has a different type of corruption within our typology of corruption, and presumably one would expect that a proper visualization of each candidate's "social network" would show differing patterns, rather like different species of spider can be classified by the geometries of the webs they weave.

That strikes me now; what struck me in April would be how useful it would be, for Naked Capitalism readers, if Richard Smith's narratives of incredibly intricate international scams could be visualized using a similar technique, and so I set out do determine it was possible to support that use case. (Spoiler: Very possibly, depending on requirements.)

Before I go on, I should introduce some simple - really! - terminology. In the diagram, Christie is a node. Nodes - Christie and his colleagues and minions - are connected together by lines called arcs. Both nodes and arcs can have labels ("Chris Christie," "Many loyalists among at least 50 people recommended for jobs," respectively). The entire set of nodes and arcs is called a graph; that is, Figure 1 (above) is a graph. Generally, I call a subgraph of nodes and arcs within a complete graph a relation; Christie and his Chief Staff, Kevin Dowd, have a relation. Caveat: People also use "graph" to mean "chart." Not only is this confusing, it makes graphing software hard to search for (especially as Google is increasingly abandoning its hitherto core search function and degenerating into a meta-shopping cart, ka-ching). Caveat: Graph theory has a powerful mathematical grounding, so but and different schools of thought have adopted different terminologies; for example, "edge" for "arc." This is a second factor that makes for confusion and poor search results. (Given the quality of the NC commentariat, there's probably a reader out there right now who's aching to set me straight on this stuff; that's one reason I left comments open.)

With that detour out of the way, let me introduce the detail image at left to show why I enjoyed the Times graph so much:

Why is this graph different from all others? What I call narrative labels. Most graphs and graphic software use symbols, letters, or simple phrases for labels, like Ω,, or "A"," or at most (as in Figure 1 at top left) "Egea's boss." However, in Marsh and Zernike's diagram, we have labels like "Long-time Christie friend, confidant. Firm has millions in state business" (the arc between Christie and David Samson, Chair of the Port Authority), or "Samson, furious at Foye for sending email about the lanes, warned 'He's playing in the traffic, made a big mistake" (the arc between Samson and Patrick J. Foye, Executive Director of the Port Authority). To trace the relationships mapped on the graph is to tell a story; that's the value to readers that narrative arcs deliver, and why I found Figure 1 so uniquely enchanting. Further, the narrative labels are much more informative than simple phrases; they can support more powerful analysis. (We might pause for a moment to consider that Figure 1 shows only one set of relations that Christie is involved in; imagine the scale of a graph that showed all of them. And now imagine what graphs for Jebbie and Clinton would look like; this is the sort of information our elites carry around in their heads, or have people to carry for them. Now think of private equity squillionaires.)

So, I got in touch with Marsh and Zernike, and determined that Figure 1 was drawn by hand in a graphics program. (That is, considered as data, it was only bits or vectors or something; in other words, their graph was not data driven. Well, obviously at NC we aren't going to be spending days drawing graphs by hand; we're not artists, and with the size of crew we have, we don't have the time. So, in order to satisfy Richard's use case, I formulated the following set of requirements:

  1. Be generated algorithmically from data I control. That is, a workflow where Richard (say) would build a spreadsheet of players and their relations, export it to CSV, the CSV would be converted into a data format appopriate for graphs, and then fed to software that would display the graph automagically.
  2. Have narrative labels on curved arcs. See above for the rationale for narrative labels. The arcs must be curved, as the arcs in Figure1 are curved, to fit the graph within the smallest possible (screen) space.
  3. Be pretty. There is an entire literature devoted to making "pretty" graph, starting with making sure arcs don't cross each other. In essence, though, it's down to the algorithm, and we know it when we see it. A hairball, for example, is not pretty.

So now I'm going to take you on my serindipitous journey through the wonderful world of graphing software to see if I can find anything that meets my requirements. One reason I'm not jumping straight to the conclusion (although you may) is that the graphing world seems very siloed; combine that with Google's wretched search function, and there are almost certain to be technical alternatives I didn't consider, so readers, please correct me. Further, two of these tools, at least - Muckety and LittleSis (opposite of Big Brother) - may be useful to you in your own research.

So first let's look at Muckety, "the place for tracking people and organizations with power and influence." Here's what Muckety's graph of Christie looks like; handily, they enable embedding, so I'll include the live, interactive version. (Here's the link if you don't have Flash.)

Figure 2: Muckety

So this is neat, but Muckety fails Requirement #2: The labels are not narrative and they are not on curves. The detail image:

2_detail_muckety

A second failing, at least in my view, is that labels only appear when you hover over them; you cannot, as with Marsh and Zernike, get a comparative and synoptic view of all relations at the same time. Muckety also fails - unless, I think, one licenses the software - Requirement #2: Although the graph is algorithmically generated, I don't control the data.

Next, let's look at software from the world of mathematical typesetting, since graph theorists need to generate images of graphs for their papers. To me, that means the formidable TEX typesetting package, which includes a (very cool) library called Tikz (examples; documentation). I downloaded it and did some typesetting, and it will produce diagrams like this:

Figure 3: Tikz

3_full_tikz

(This is, of course, static, like Figure 1, and unlike the dynamic Figure 2; no hovering or dragging about of nodes. (Dynamic graphs are not a requirement for me, because my first priorities are representation and social engineering; see the epigraphs.)

Tikz meets Requirement #1 (TEX generated the file from my data) and arguably meets Relequirement #3 (it is pretty) but it fails Requirement #2: It does not permit narrative labels. My hope was that somehow TEX could be cajoled into treating arcs as baselines, along which the text fo the labels would run, following the curve if the arc curved, but Tikz does not do that, and try as I might, I couldn't find another package that did. The TEX world wants, it seems, to put a short snippet of text in a box and stick the box near the label. The detail image:

Finally, in phase one of my quest, I looked at the concept mapping world and found Cmap, which "empowers users to construct, navigate, share and criticize knowledge models." (Here's a gallery.) There is not yet a Cmap of Chris Christie's web of corruption, so I made a small test map:

Figure 4: Cmap

4_full_cmap

As we can see from this detail image, Cmap meets Requirement #2, at least as stated: It supports narrative labels, and arcs can be curved:

Further, Cmap meets Requirement #1: It supports importing data from a spreadsheet, and it generates the graph algorithmically.

However, in my opinion Cmap fails Requirement #3: The maps are not pretty. To be fair, there are many formatting tools available (that's why the text in the labels can be bold and italic, as in Figure 1) but it's way too much work to make the graph look good, and I think the narrative label text really should follow the baseline.

So there the matter rested; Cmap seemed like the best I could do. If we ever needed a graph of relationships that could be generated from spreadsheet data, there was a tool for it.

* * *

The matter rested until the following from Edward Tufte came across the Twitter. Note the narrative labels; narratives always include verbs:

(See this link for Tufte's thoughts on what "pretty" means.)

Tufte's posts recalled me - and how could I have forgotten? - to Mark Lombardi's hand-drawn "narrative structures" of power relationships, which are wall-sized and hang in fine art galleries:

Figure 5: Lombardi

4a_lombardi-05_full

The full image can be seen here at Socks, which describes it:

A nodal point in Mark Lombardi's oeuvre was the 1999 "George W. Bush, Harken Energy and Jackson Stephens, ca 1979–90″ (also shown in dOCUMENTA 13), which described the alleged connections between James Bath, the Bush and bin Laden families, and business deals in Texas and around the world.

Gorgeous, isn't it? Clearly, this meets Requirement #3; it's pretty. However, Lombardi fails to meet Requirement #2, as this detail image shows:

Lombardi does not use labels, let alone narrative labels, and so his "description" (as Socks would have it) is not nearly thick enough. It's not enough to draw an arc between the node for "George W. Bush" and the node for "Arbusto Energy," because absent a label, the relationship has no type? Father-son, as the relation between the nodes "George W. Bush" and "George H.W. Bush"? Ownership? Employment? We just don't know. So Lombardi's graphs, though beautiful art, are weak analytical tools.

Note that Robert Tolksdorf's Lombardi Networks site, in a highly laudable effort, is converting the Lombardi images to structured data in GraphML, XGMML, and JSON formats. From the FAQ:

Q: So you want to scan all Lombardi works?

A: No, the works shall not be scanned as images. The networks depicted shall be represented as a datastructure. In it, nodes are connected by edges. The format of choice for this representation is called GraphML and a variety of tools for editing such networks is available.

Q: So you want to generate Lombardis drawings by computers?

A: No. Although there are tools to draw graphs and there is even a thing called "Lombardi Graphs" [Christian A. Duncan, David Eppstein, Michael T. Goodrich. Lombardi Drawings of Graphs. Journal of Graph Algorithms and Applications. Vol. 16, no. 1, pp. 37-83 (2012)], the intention is to provide the data structures and to do analysis on them. Their visualization is not in the scope of this project.

Well, I want to "do analysis on them," and "vizualization" too! However, vizualization inevitably involves tooling, and Tolksdorf recommends Cytoscape, which I tried in the first phase of this effort, but couldn't get it to meet my requirements. And if any readers know of a GraphML tool that will, I'd love to hear about it!)

Tolksdorf's site, however, linked to and reminded me of the LittleSis site - and I'd also been seeing some small LittleSis graphs float by on the twitter, so I went there and found this. It's not of Christie, but at least it's a New Jersey pension "pay to play" scandal.

  1. LittleSis graphs are generated algorithmically from data I control. True, there's a web interface for data entry. But the data is under my control, and the graph is generated algorithimcally. (Whether I could import an entire graph as CSV, in the spreadsheet workflow, I don't yet know.)
  2. LittleSis has narrative labels on curved arcs. See the detail shot below
  3. LittleSis is reasonably pretty. I'm seeing some arcs running into each other, but they don't cross each. The graph is certainly not a hairball!

Here is the detail image, showing the narrative label on a curved arc:

5_detail_little-sis

Now, whether it's possible for me to set up a LittleSis operation on my own machine… And set up that spreadsheet-driven workflow… I don't yet know.

(At this point, I should mention that both LittleSis and Muckety are encouragingly free - at least as I poke around their sites - of funding sources that make my neck hairs rise. It's almost like the elites don't want their power relation examined too closely, isn't it?

* * *

But– But– Why are you telling me all this? For several reasons:

First, look at Naked Capitalism's motto: "Fearless commentary on finance, economics, politics and power." Images like those in Figures 1, 2, and 6 can surely assist in commentary. Whether in finance, economics, politics, or power, we are dealing with highly complex and interacting systems, and graph representations - especially those that meet my requirements :-) - are suitable for visualizing them.

Second, one of my takeaways from our Greek coverage is that we have many technical readers. We may not always agree with them, but technical they are! It's possible that graph visualizations will speak to such readers - who may be familiar with UML or dataflow diagrams, for example - more clearly than prose alone (subject to the condition, expressed in Requirement #1, that the graph visualizations are data-driven and algorithmically generated; we aren't going to be tweaking illustrations manually to make them prettier than possible).

Third, there's is a tremendous variety of discussion on what we call "the left" about the relations between "finance, economics, politics and power" as expressed in the (dread word) intersections between class, race, gender, and so forth. In a perfect world, which I am not clever or powerful enough to bring about, discussions for "the nodal points" among social engineers - perhaps we should think about replacing that word "activist" - would be enhanced by a common visualization that could be whiteboarded (as opposed to bullet points on flip charts, say). I think that graph theory is the place to look for such a visualization, and Muckety and LittleSis (as well as Lombardi) may be pointing the way toward this. Such a visualization would appeal to people as disparate the activist community, and as separated in culture and cohort as node.js and COBOL programmers.

Comments are open!

About Lambert Strether

Lambert Strether has been blogging, managing online communities, and doing system administration 24/7 since 2003, in Drupal and WordPress. Besides political economy and the political scene, he blogs about rhetoric, software engineering, permaculture, history, literature, local politics, international travel, food, and fixing stuff around the house. The nom de plume "Lambert Strether" comes from Henry James's The Ambassadors: "Live all you can. It's a mistake not to." You can follow him on Twitter at @lambertstrether. http://www.correntewire.com

Paul Hirschman July 21, 2015 at 12:44 pm

Tufte is the master of such visualizations, so you're on the right track.

Network analysis among sociologists, which has existed for quite a long time, covers what you're talking about, so they may have developed visualization techniques that could improve this effort.

Jeff W July 21, 2015 at 1:19 pm

I was going to mention Edward Tufte, who makes a more general point, also.

Tufte says

To clarify, add detail. Imagine that, to clarify, add detail. Clutter and overload are not attributes of information, they are failures of design. If the information is in chaos, don't start throwing out information, instead fix the design.

(The actual quote is from Tufte's talk on iPhone resolution.)

That's what's going on with the narrative labels on the arcs in the graphic that lambert finds so enchanting. The labels add just enough relevant detail to make the information, which otherwise might be a chaotic mess, much more accessible-it helps the person looking at the graphic "make sense" of what he or she is seeing.

  • Ulysses July 21, 2015 at 1:23 pm

    Very interesting indeed! I have had the privilege of some rather rigorous training in the techniques of prosopography by some competent classicists and medievalists. Applying prosopographical techniques of analysis– to present-day movers and shakers in politics and finance– would certainly provide plenty of grist for this intriguing mill that you are keen to construct.

    https://en.wikipedia.org/wiki/Prosopographical_network

  • optimader July 21, 2015 at 3:27 pm

    Went to this last year. Tufte is indeed the master of visual data reduction /presentation. http://www.fnal.gov/pub/tufte/ Its a funny story how this exhibition was put together. Tufte had built some Feynman diagrams as object de art and they were on display at a friends NYC art gallery in a window. A director from Fermi was in town and walking down the street said gallery and did a "wait a second what's this about??"

    The gallery employee didn't have a clue what a Feynman diagram was, "hey, its art", let me put you in touch with the artist (Tufte) who, in this case was less so an artist and more of a craftsman (truly Feynman was the artist). Based on that chance observation and subsequent discussions with Tufte, the exhibition was put together.

  • Eric Patton July 21, 2015 at 1:52 pm

    Not sure that this is what you're exactly looking for, but Michael Albert has written about economics, culture, kinship, and polity as four spheres of society that interrelate and co-reproduce in one another. You'd probably want to look for his (and Robin Hahnel's) Socialism in Theory and Practice two-volume set from a few decades ago (published by South End Press). I believe the full text is available online somewhere (for free) as well, at this point.

    Anyway, the work is quite good. You may or may not agree with all of it, but it will give one much to consider.

  • Chmee July 21, 2015 at 1:59 pm

    This graphing system is pretty far out of date for giving results, but at one time it was pretty useful, although admittedly a bit confusing with all the lines that get produced.

    http://mapper.nndb.com/start/?id=162983

  • Andrew Foland July 21, 2015 at 2:03 pm

    From an analysis point of view, once you have nodes and links, you can have link "weights" determining the strength of the tie; and then there's a lot of work on determining "centrality" measures to weigh the importance of the various nodes.

    Even if you don't have a good measure of strength, I bet a centrality analysis of, say, donor/candidate networks, would yield some interesting (and surprising) names. Or of, say, corporate-board networks. (Where a link means "serves on a board with").

    I bet there's a whole world of interesting network analysis to be done with data one might scrape from opensecrets.org and EDGAR.

    1. norm de plume July 22, 2015 at 7:41 am

      Intriguing idea. I envision a graph which displays the weight of nodes in 3 dimensions, looking something like those visualisations of the effect of large body gravity in spacetime, where the 2D surface plunges around the object to represent the power of its attraction.

      Added benefit would be all that extra room for arcs not to run into each other. In fact to be linked to each other without criss-cross.

      'I bet a centrality analysis of, say, donor/candidate networks, would yield some interesting (and surprising) names. Or of, say, corporate-board networks… I bet there's a whole world of interesting network analysis to be done with data one might scrape from opensecrets.org and EDGAR'

      Oh yes. I would add finance-capital networks; from TBTF banks to hedge funds to central banks to Eurocrats to TPP corporate lawyers to offshore havens to military/intel shopfronts to Davos to the wealthiest families in the world.

      I bet there would be evidence suggestive of not just obvious large bodies like planets, but of previously unseen black holes.

      Not that I'm foily! Could untangle a few hairballs though…

      1. TheCatSaid July 22, 2015 at 9:58 am

        Weighting to indicate significance seems important.

        That could be evaluated re: financial/capital flows, as you suggest. Equally important, is a way of indicating the potential value of those flows to 3rd parties. (E.g., a campaign contribution of 5 figures conferring impact on legislation could yield a benefit of 7 figures to a third party such as a finance or real estate company and their executives)

        Another form of weighting could be impact for impacting framing / PR (e.g. direct or indirect power to manipulate media and control public discussion)

  • watson July 21, 2015 at 2:40 pm

    Interesting. I think these kinds of visualizations can really add to discussions and analysis. I'm a scientist by training, and there's a lot of specialized software out there to analyze and visualize gene and protein interaction data and networks. I wonder if some of the open-source tools or add-ons could be co-opted, substituting finance, politics etc nodes for genes. This isn't something I do a lot of myself (that's what the computational biologists help with, plus I'm no longer in the lab), but I'll ask around. There must be R packages that let one do the sort of thing you're talking about.

  • Steve H. July 21, 2015 at 2:47 pm

    :)

    You may already know the site, but ZenPundit is deep into the narrative constructions surrounding power, expecially with its intersection with religion given the moral force of middle-east fundamentalism. There's an aspect of his method (tip hat to Hesse) involving counterpoint or antithesis which strikes a fundamental chord of narrative: compared to what?

    Another aspect of what you're doing is that the power relations run in different dimensions than straight through the obvious alliances. The more we see it, the clumsier the execution, so it's selecting out the deepest players. By definition, those are hard to get set down as nodes, but for a start I'd look at where their kids went to school.

    Really glad you're doing this, Lambert.

    1. lambert strether July 21, 2015 at 2:57 pm

      What I don't know is far more than what I do. There seem to be a lot of laborers in this vineyard, but few of them are in touch with each other. It's a large and challenging field, which is why I welcome links.

      Power relations in different dimensions would be hard. One thinks of a legend, and controls as with a geographical map to filter on layers.

      And of course, in a perfect world, the software would have a time dimension, so we could see the graph evolve…

      However, whiteboarding is also very important!a

      1. Steve H. July 21, 2015 at 5:06 pm

        Ian McHarg was mentioned in the earlier post on water, he was a pioneer on overlays, and how things would pop when the right set intersected.

        How to get edges to pop, something like cluster analysis. When Gates and Buffet joined in on the bomb train line, Gates indirectly donated to XL pipeline foes, which inhibited the competition. You have Gates and Buffet literally owning nodes and edges, then applying antithesis to the pipeline, trackable through a Gates donation through a college.

        Cory Morningstar traces that narrative, but her website appears inactive. Inhibiting the competition is also part of which third parties get donations in political races. And the best information usually comes from those cut out of the deal, those who've been excluded and antithesized (see Deep Throat, Watergate).

        1. Lambert Strether Post authorJuly 21, 2015 at 6:26 pm

          Got any links on that material? (I'm certainly getting the kind of commentary I wanted!)

          1. Steve H. July 21, 2015 at 10:13 pm

            Looks like Counterpunch reprinted, here's a start:

            counterpunch.org/2013/04/12/keystone-xl-the-art-of-ngo-discourse/

  • Robert Tolksdorf July 21, 2015 at 3:50 pm

    Hi,

    thanks for referring to my work at lombardinetworks.net. Lombardis networks do in fact use labels, either explicitly for financial transactions (showing the amount transferred), or implicit by typing. The arcs do have types, they are distinguished by the visual form. Sometimes, they depend on the type of node linked, the linkage between two year nodes means succession in time. So the one-headed arrow means "influence on" and the double headed arrow means "association". This is, of course a very broad type, but at least there is one.

    During digitizing the currently 17 works, I came across 12 types – if I count correctly – that you find formalized in the ontology at http://www.lombardinetworks.net/wp-content/uploads/2012/11/lombardi.owl.

    You are right, of course, that the types are not well characterized and are hard to use for analysis. So a next step would be to look at whatever relation are around in the mentioned approaches and to try to build an ontology fro them, to link into characterizing concepts found elsewhere (eg. dbpedia) and then to link to the existing approaches with sameas- or seealso-relations to help to integrate them. In the end, one would have a powerrelations ontology that is openly linked to existing data and would be enabling to do quite good analysis.

    1. Lambert Strether Post authorJuly 21, 2015 at 5:32 pm

      Thank you. (I looked for a legend and if it was there, missed it.)

      Out of curiosity, since it seems like you would know… Is there an engine that uses GraphML and meets my requirements?

      Reply

      1. Robert Tolksdorf July 22, 2015 at 10:46 am

        There is a legend in the Global Networks catalogue, but it only covers 5 or 6 types of relations.

        Cytoscape could im- and export in the 2.8. version. With version 3 there is only import. In the version, GraphML shall be back, the developers told me. I have no idea why one should drop GraphML. However, it is simple to convert XGMML to GraphML and vice-versa. The prettyness in Cytoscape can be well adjusted, I do have a simple "lombardi" style for Cytoscape. It is not fully implemented in the exported visualizations on my site, so I hope for the next versions.

        Robert

        Reply

  • Don Weightman July 21, 2015 at 4:14 pm

    This is cool, beautiful and interesting.

    Radical (and other) activists use this kind of power-mapping to come up with strategies for individual campaigns: e.g. SumOfUs getting Lowe's to stop selling bee-killing pesticides. Switching idiom from their (our, actually) "pillars of support" concept, the idea is to go through the various network edges/arcs connecting the target with its supporting nodes (power bases, customers, audiences, constituencies, co-conspirator-"strategists", whatever), find the weakest strategic link, and disrupt it.

    Now if you could come up with something wildly user-friendly with off-the-shelf software that would allow you to display weight for network edges/arcs you would beat the h*ll out of whiteboards, make some friends among deserving organizers, and maybe do the Movement (excuse the expression) some good too.

    Reply

    1. Lambert Strether Post authorJuly 21, 2015 at 6:46 pm

      I think the whiteboard part is important. A notation that works in that context goes far beyond people (like me, I admit) who carry digital devices around with them at all times. We need a notation people that's as close as possible to being able to scratch in the dirt with a stick. (Rather like football plays, come to think of it.)

      Reply

  • Torsten July 21, 2015 at 4:40 pm

    Lambert, it seems you should hook up with Joe Firestone on this. He has long been into things like Topic Maps, RDF, and similar machine-processable graph-knowledge structures. For my money, search engines are a superior research tool, but there are certainly times when one wishes "a relation" (i.e. "subgraph") could be extracted with simple, list-like labels. Of course the MOTU are using Palantir…

    Reply

  • ekstase July 21, 2015 at 5:25 pm

    Figure one could hang on a writer's wall and be a fantastic basis for a novel. This is what "fiction" writers intuitively do, and it's fascinating to see it mapped out like this. I see the "thinking" function at work here perhaps. Not the arts' strong suit, but interesting.

    Reply

  • Tiercelet July 21, 2015 at 5:29 pm

    This interests me greatly; (well-constructed) visualizations are an incredibly powerful tool for communicating the most important information.

    It'd be even more awesome if LittleSis let you replace the arrows, as much as possible, with the narrative text itself; that seems to be what both Tufte and the NYT have done. But just having it automagically generated from data is an incredibly powerful thing.

    Unfortunately, the Oligrapher project (the code that seems to generate graphs from LittleSis' data) is written in JavaScript, which is not the greatest choice you could make for a technical application (but seems to be the only thing the Cool Design Kids can wrap their heads around these days). The plus side, of course, is that JavaScript runs in your browser, so you shouldn't really need anything to get it going other than a page that pulls in all the appropriate libraries. So it should be possible for you to set up your own tool, and rewrite the functions that pull in LittleSis data to point to a well-formed spreadsheet instead… maybe.

    I don't have a whole lot of time right now, but if I can be of service, I assume you can see my email…

    Reply

    1. Lambert Strether Post authorJuly 21, 2015 at 6:25 pm

      If you want to get something done, ask a busy person….

      Reply

  • H. Alexander Ivey July 21, 2015 at 6:45 pm

    Ah, requirement #2! That is the killer. Embarassed to admit how many years I've worked with data flow graphs and yet never thought of having the text flow along (and replace) the connecting line.

    Rqt 2 is worth getting out of bed to read. Will be checking out LittleSis.

    Thanks for this post.

    Reply

  • JCC July 21, 2015 at 9:30 pm

    Have you looked at FreeMind? http://freemind.sourceforge.net/

    It may meet all your requirements and is exportable in html, pdf, xhtml, openoffice, etc. although I'm not sure what the importing capabilities are. I'm running an older version (on OS X and linux – java based, runs on MS, too) but they add new features all the time… and it's opensource software.

    Do a google search for mind mapping software, there are quite a few good ones out there that easily meet requirements #2 and #3, just not sure about #1. Some others are MindManager (mindjet) and TheBrain (this one has some import capabilites)

    Reply

    1. JCC July 22, 2015 at 12:09 am

      Apparently Sourceforge has been having problems this week, here is another (good) link to freemind at sourcefourge: http://sourceforge.net/projects/freemind/?source=directory

      Reply

  • Lambert Strether Post authorJuly 21, 2015 at 11:50 pm

    Thanks for the thoughtful comments!

    Reply

  • Jeremy Grimm July 22, 2015 at 2:22 am

    The US Army uses graphical network representations to visualize their unit force structures and equipment allocations. The group I worked with used a tool called netViz until sales and support for that tool fell victim to corporate politics following a large merger and the consolidation of the corporate software portfolio. Our group tried other tools substituted for netViz, including Visio and UML based architecture tools, but very poorly in my opinion. None of these other tools could replace the touch and simplicity of working with netViz.

    One feature netViz had you would want for your network tool is a "catalog" of node symbols/images and an associated catalog of connectors/arcs. A user can position and attach arbitrary descriptor fields around a node-type or connector-type.

    Another especially nice feature of netViz was its' interface with csv files. However, after working with several different approaches to automatically generating network diagrams over period of a few years I slowly came to believe visualization networks were best created semi-automatically. Though this is slower than full automation, the placement, sizing and visual spacing between nodes, and the direction, color, curvature, turning points and thickness of connectors are all part of a complex visual language of inestimable value for understanding the a complex netork representation.

    An algorithm can generate all these things. But humans must understand the visualization. Until much more is known about how that understanding takes place the programming complexity grows rapidly as you might imagine and quickly reaches a point of diminishing returns. In my opinion, a semi-automated approach which lets the program select and make preliminary placement of nodes and connectors - something a program can do much more easily than humans - followed by a careful re-layout of the network diagram by hand more than repays the time and work invested in that restructuring. For very complex diagrams I found I could only understand them as I organized and manipulated their visualizations.

    I believe InkScape might be modified to add the features necessary to re-implement capabilities netViz possessed, although InkScape seems to lack some of the responsiveness between mouse and image that I find crucial to the facile manipulation of a network diagram.

    The Domhoff site "Who Rules America" includes several links to ongoing efforts to diagram various power structure networks, http://www2.ucsc.edu/whorulesamerica/links.html. However I cannot claim specific knowledge of what they have in the works - LittleSis - is linked there.

    Sankey diagrams offer another kind of diagramming technique which might be combined with a node and connections representation. Sankey diagrams are popular for representing flows in corporate reports. I recall seeing a link to a beautiful Sankey diagram from one of the links in NakedCapitalism some years ago but I cannot locate that link. The famous diagram representing the manpower, temperature and location of Napoleon's Army as it marched into and retreated from Russia.

    The justly famous network diagram for the London Underground illustrates several principles of good design. The visual representation shows the topology of the London Underground laid out with colors, spacing and line to beautifully represent this complex transportation network in a form which can be readily understood and remembered, by humans. I will not claim it is impossible to write a program which could make a reasonable start at representing the London Underground - but no program I know could have come up with the representation rules the human designer created as he worked and re-worked this diagram.

    Reply

    1. Jeff W July 22, 2015 at 4:49 am

      I recall seeing a link to a beautiful Sankey diagram from one of the links in NakedCapitalism some years ago but I cannot locate that link.The famous diagram representing the manpower, temperature and location of Napoleon's Army as it marched into and retreated from Russia.

      Lambert referred to and posted the famous graphic of Napoleon's invasion of Russia by French civil engineer and cartographer Joseph Charles Minard in this comment. A high resolution version can be found on Wikimedia here.

      Reply

    2. Jeff W July 22, 2015 at 5:58 am

      I will not claim it is impossible to write a program which could make a reasonable start at representing the London Underground - but no program I know could have come up with the representation rules the human designer created as he worked and re-worked this diagram.

      Martin Nöllenburg tackled this problem in 2005 for his Master's degree thesis "Automated Drawing of Metro Maps" and concluded "Our experiments with real-world metro networks show that we have succeeded in drawing these networks [by automated methods] in a quality comparable to maps drawn by graphic designers." I think the maps might be "comparable" but I agree-they probably still would not match those carefully worked and reworked by someone like Harry Beck who designed the London Underground map. (Dr Nöllenburg's PhD dissertation, incidentally, was on the topic of network visualizations and he's done some work on Lombardi graph drawings-his publications are listed and available online here.)

      Reply

      1. Jeremy Grimm July 22, 2015 at 8:46 am

        Thank you for the links to the papers on drawing Metro maps and the Lombardi graphs. I recall hearing about the map labeling problem and also saw several studies of that problem on the site you referenced. … Although the Lombardi graphs are pretty, I am not sure how well they convey the meaning of the data they represent.

        The diagrams of the London Underground and Napoleon's march are two of my favorite graphic diagrams. I have prints of each of them.

        Reply

        1. Jeff W July 22, 2015 at 7:07 pm

          You're welcome!

          I think-but I am not sure-that some application combining (1) fast, responsive vector graphics, (2) direct manipulation of the graphic (e.g., dragging the nodes/arc), (3) a catalog of node/arc types, and (4) various algorithms of the type that have been developed would be as good as, if not better than, something like netViz.

          Xara (for PCs) and Affinity Design (for Macs), to name just two examples, satisfy the first two (and a catalog of shapes), at least-not surprising since some of the developers for the former are now developing for the latter-but they're more general graphic design applications, not graph or network graphing apps. It seems like those on the data-driven graphing side of things and those who have come up with excellent and flexible solutions on the purely graphic design side of things have not (yet) met up. Maybe it's partly an issue of path-dependence-for example, it seems like all genealogy software that I've used (on rare occasions, thankfully), another kind of "networking" software utilizing nodes and arcs, is stuck in the 1990s or earlier, perhaps the era when it was first developed, full of awkward dialog boxes and not a more directly manipulable interface-or maybe the data-driven side of things (getting things to "look right" with a given data set) has been challenging enough, not allowing focus on the other aspects of usability. (This part of my comment is directed as much to those people developing the software as it is to you-hey, there seems to be an opportunity here!)

          The London Underground diagram has come under fire in recent years-its lack of geographical accuracy may cause as many as 30% of passengers to take a longer route than needed, one study says-but, even granting the criticism, it and the graphic of Napoleon's march are still masterpieces of information visualization design. They're two of my favorites, too!

          Reply

  • Stephen Wigney July 22, 2015 at 9:26 am

    Excellent thread… Thank you so much…

    Reply

  • Thomas July 22, 2015 at 9:28 am

    Lots of info here: Who Rules America: About Bill Domhoff – UCSC.edu www2.ucsc.edu/…/about.html University of California, Santa Cruz G. William Domhoff, who goes by "Bill," is a Research Professor at the University of California, Santa Cruz. Born into an apolitical middle-American family in what … Who Rules America? Power, Politics, & Social Change www2.ucsc.edu/whorulesamerica/ University of California, Santa Cruz by G. William Domhoff. Welcome to WhoRulesAmerica.net, a site about how power is distributed and wielded in the United States. It both builds upon and greatly … ‎The Class-Domination Theory – ‎Wealth, Income, and Power – ‎Bohemian Grove G. William Domhoff – Wikipedia, the free encyclopedia https://en.wikipedia.org/wiki/G._William_Domhoff Wikipedia George William (Bill) Domhoff (born August 6, 1936) is a research professor in psychology and sociology at the University of California, Santa Cruz. His first book .

    Reply

  • participant-observer-observed July 22, 2015 at 10:31 am

    Dear Lambert, I think you are on to something very valuable here, especially for an election season.

    To encourage you further in this pursuit, I would like to attract your attention to GEOGRAM software, which is used in family systems analysis and provides symbols for denoting dysfunctional and other unproductive relations among members of the system. Why no one has ever thought of applying it (or a modification of it) to politicians and the cesspools of networks before is curious.

    Keep up the good work!

    p.s. Do you think it was it only a coincidence that Google posted a billion dollar surplus the same week China markets posted trillions lost?

  • [Sep 27, 2015] Maria Zakharova, spokeswoman for Russian Foreign Ministry, grades Nuland's paper

    September 16, 2015 | Fort Russ/Komsomolskaya Pravda

    It is impossible to deal with cockroaches in one room while at the same time laying out little plates of bread crumbs on the other side of the wall.

    Translated from Russian by Tom Winter

    Translator's note: this press account is based on a post on Maria Zakharova's facebook page, and I have changed this account slightly in alignment with Zakharova's original text. It was not clear in KP what was Zakharova and what was KP. I think it is in this translation...

    Head of the Information Department of the Russian Foreign Ministry wrote a "critical review" on the "Yalta speech" of the assistant US Secretary of State.

    In Kiev, there was a conference "Yalta European Strategy". Already amazing. Yalta is in the Russian Crimea, and the "Yalta" conference was held in the Ukrainian capital. Well and good -- you couldn't miss that one!. But at this Yalta conference came the assistant US Secretary of State Victoria Nuland. Yes, the same one that passed out the cookies. But now, considered a shadow ruler of Ukraine, she points out to the Kiev authorities what to do. This time, Nuland said in a public speech:

    - There should be no tolerance for those oligarchs who do not pay taxes. There must be zero tolerance for bribery and corruption, to those who would use violence for political ends.

    And these words of the grande dame of the State Department could not be overlooked. Just think, Americans don't like it when their loans to Ukraine get stolen. And anti-oligarchic Maidan brought the very oligarchs to power, and corruption in the country has become even greater. Some of us have grown weary of this talk. But, let Nuland drone on ...

    But then Russian Foreign Ministry official spokesman Maria Zakharova replied. So much so that not a stone was left on stone in the American's "Yalta speech":

    "All this a little bit, just a little, looks like a lecture to the fox about how bad it is to steal chickens, but actually it surprised in other ways. As soon as Russian authorities began exposing the tax evasion, bribery, or corruption of the oligarchs, Victoria Nuland's office hastened to call zero tolerance "political repression" - Zakharova wrote on her facebook page.

    It would be great to see the Department of State "show that same zero tolerance and inquire a bit about how the initial capital of the Russian (and Ukrainian would not hurt) oligarchs got started, those oligarchs who have been accused of corruption at home, but who, once in London, feel protected by the authorities, enjoying all the benefits of membership in the Club of Victims of Political Persecution" - continued Zakharova.

    "It is impossible to deal with cockroaches in one room while at the same time laying out little plates of bread crumbs on the other side of the wall. Giving the green light to the dirty money from Russia and the former Soviet Union, the Western world is only boosting the zeal with which the domestic thieves shove their loot in foreign bins."

    "Though perhaps," wonders the Foreign Minstiry spokesman "this is the actual purpose of the imaginary zero tolerance?"

    "Why do people on Interpol's lists, by the decision of the Russian courts, prove their financial immorality, as they thrive in the Western capitals, and no alarm bells go off in the State Department?"

    It turns out to be an interesting story: Taking fetid streams of notes, the West has just one requirement at the border crossing. Scream "victim of the regime." That's it! and you're in spades!

    This calls to mind the old Soviet bribery password translated into modern American:

    - In Soviet times, it was common phrase, revealing corrupt intent to proceed with plans insidious in varying degrees: "I'm from Ivan Ivanovich." Today the corresponding "Open Sesame" that opens the doors "in Europe and the best houses in Philadelphia," is the phrase "I'm running away from Vladimir".

    Victoria, if you're going to start cleaning out the cockroaches, stop feeding them on your side.

    [Sep 18, 2015] Poroshenko is deliberately overpricing the company so it won't sell

    marknesop, September 16, 2015 at 12:49 pm
    Well, actually, he did, if I remember correctly. Roshen was indeed placed in a trust, so that Poroshenko cannot fiddle with the day-to-day running of it, which he would hardly have time to do anyway. Yeah…here's a mention of it; Rothschild's (surprise!!) is holding on to it for him, and it was Nestle who offered "no more than a Billion dollars" for the company. According to the article, it is just the owners' judgment that says it is worth three times that amount, and it seems odd an American company would try to rip off America's good friend by low-balling him. I wonder if he has not deliberately priced it so it won't sell.

    According to Sputnik, the company is worth $1.5 Billion, although they don't say how that figure was arrived upon, either. I know you will be surprised to learn that Poroshenko blames….Russia for his failure to sell the company. Uh huh, he said "at the moment, Russian authorities – and it would be better to ask [the management of] Roshen about this, are preventing the sale…In any case, it must be carried through to the end."

    Hmmm….I'm kind of editing this as I go along, as I find more information. Here's what is to me the most informative site so far; Kapital says the company was assessed at $1.6 Billion by Eavex Capital Investment company. Eavex is the former Sincome Capital, relaunched as Eavex following the acquisition of a 10% minority shareholding by Accuro Group (Zurich). Eavex reports that two factories have been shut down; Lipetsk, in Russia, and Mariupol. Perhaps that has something to do with the zeal with which the state military is defending Mariupol; if that factory could be restored to stable production, the company's worth could go up to $2.1 Billion. The current assessed value is based on "a multiplier calculated on financial performance of the corporation in previous periods", to which a discount is applied for reduced volume of business. But you have to hand it to Roshen – even without Poroshenko's steady hand on the tiller, they have increased their stores in Kiev to 18, a 38.4% increase over 2013. Roshen chocolates and candies are also sold in supermarkets and retail chain stores, and new supermarkets increased by more than 20% in Ukraine in 2013.

    Anyway, it does look like Poroshenko is deliberately overpricing the company so it won't sell. Nestle offered $1 Billion even, the company as it currently stands is worth $1.6 Billion, if it could restore the Mariupol factory to stable production and perhaps dispose of the Lipetsk factory it might be worth as much as $2.1 Billion, and Poroshenko is asking almost $1 Billion more than that.

    et Al, September 16, 2015 at 2:24 pm
    I sit corrected (the cat has f/k'd off). Then it makes eminent sense to not sell now, especially to Nestlé who are as brutal as you would expect from an American company. They bought Cadbury in the UK a few years back, the Conservative government receiving 'ass-urances' that they won't butcher Cadbury. Of course, Nestlé did. It was another case of a US company off-shoring its taxes to the UK (big pharma has done this too with the UK), which is weird. We are told that the US is great for companies because it has low tax blah blah blah blah.

    So, why do US globocorps need to shift their tax address to countries like the UK to avoid paying tax. I say follow Italy's model. Massively support SMEs and make sure they co-operate with each other as the sum of parts so that they are global competitors. This is what German companies do. They band together and go global. The Frogs, not so much.

    I 'know' a French engineer who want to take his 3D printing patent big time. His boss won't fund it as it is 'high risk', no other French company is interested because of IP and who gets the cash. In the EU, if you can pony up half the development money from private sources, the EU will pitch in the other half, particularly for ground-breaking and innnovative products. I asked him if he'd looked abroad. No. I even suggested Japan as this is what James Dyson of bagless hoover fame did. Not one single European white goods manufacturer gave him any time. A big Japanese company did which meant he could set up his laboratory and factory in the UK. When Euro-companies started copying his designs, he had the full weight of a massive Japanese corporation's legal department to shit on them from a great height.

    The crux being, if the U S A is so great for business, WTF are they doing tax dodging in expensive, crappy Europe (mofos)? /rant

    Jen, September 16, 2015 at 6:03 pm
    I believe the Cameron govt keeps cutting corporation tax, precisely to attract more money, and Ireland, Liechtenstein, the Netherlands and Switzerland also have very low corporate tax rates. Jersey and the Isle of Man (both part of the UK) are also attractive places for US investment.
    https://home.kpmg.com/xx/en/home/services/tax/tax-tools-and-resources/tax-rates-online/corporate-tax-rates-table.html
    marknesop , September 16, 2015 at 12:37 pm
    It is worth mentioning also that Poroshenko was a co-drafter of the European Association Agreement, before he ran for office. It has been suggested that he wrote a number of amendments into it which would have been extremely beneficial – not to mention lucrative – for Roshen had the transition been the great and thunderous success Europe plainly expected it to be. Little bit of a conflict of interest there, but it might help to explain why he is holding on to his business. After all, if nobody's buying but you genuinely want to sell, you drop your price a little, sort of feel around to see where the floor is. Poroshenko has never dropped his price to the very best of my knowledge, and some Candy News site reported a large company – Cadbury, or somebody in their league, I forget now – made an offer but it was much too low for Poroshenko. This further imples he is not really interested in selling and may even have deliberately priced it too high, because he expects to return to life as a wealthy…ahem…"tycoon" once he has served his penance as Ukraininan leader.
    Moscow Exile, September 16, 2015 at 9:41 pm
    The Ministry of Defense of Ukraine purchased 4 tons of chocolate from LLC "Kyiv Confectionery Company" on September 2, also known as the official distributor of the Roshen Corporation. The total transaction amounted to 995 520 UAH [$45,923].

    See Fort Russ: Ukrainian MOD bought 4 tons of Roshen chocolate for the Ukrainian army

    [Sep 09, 2015] The Great Deformation The Corruption of Capitalism in America by David A. Stockman

    Amazon.com

    Stockman, veteran of the Reagan White House and Wall Street, offers his self-described polemic, a wide-ranging indictment of the American government-economic complex; free markets and democracy have been under long-term attack, and the author explains why we have myriad problems, perhaps intractable. He indicates the book "contains much original interpretation of financial and public policy events and trends of the last century, even a revisionist framework." Stockman concludes his lengthy controversial argument with: "the cure . . . is to return to sound money and fiscal rectitude and to correct the great error initiated during the New Deal . . . . In pursuing humanitarian purposes the state cannot and need not attempt to manage the business cycle or goose the free market with stimulants for more growth and jobs; nor can it afford the universal entitlements of social insurance. Its job is to be a trustee for citizens left behind, maintaining a sturdy, fair and efficient safety net." This thought-provoking book will contribute to important debates on these issues. --Mary Whaley

    The Great Deformation The Corruption of Capitalism in America David A. Stockman 9781586489120 Amazon.com Books

    A grim view of our future

    By Drew Bruckner on April 2, 2013

    Format: Kindle Edition Verified Purchase

    David Stockman believes that our economy is almost past the point of no return. With a staggering federal debt and a deficit that keeps rising, he considers our economy to be a "setting sun" economy- our best days are behind us. But there's still hope, it's not too late to turn it around.

    The book starts off with details on how, in the past, the banks leveraged capital and how their methods of investment were contingent on a constant upward spiral of success. He goes on to talk about how the fed propped Wall Street up with hopes of creating wealth through the stock market and that he believes they have overstepped their bounds. He criticizes Greenspan for his fiscal policies and compares that bubble to the one we are in today. Most of the book talks about the past and how we can relate it to the present and what we can learn from the mistakes made by our predecessors.

    The facts and statistics he presents show that the "too big to fail" ideology adopted by the government was incorrect and in fact, many of the companies that received bailouts had sufficient assets to fend for themselves. Using AIG as an example, he outlines the overall sector's strengths and weakness during the crash of 2008. He asserts that during times of financial crisis, such as the crash of 2000, companies would inaccurately portray sales in order to make their company appear more valuable.

    Highly critical of the Fed, many of his opinions are based around failures of the federal government to correctly manage the economy. Most of the time, he believes that their attempts to bolster the economy stem from pressure from business, rich people, or other government entities. He takes the reader through all of the United States' bubbles since before the Great Depression and explains the causes of each one. According to his statistics, most of the bubbles were caused by the Fed unnecessarily pumping money into the economy. He talks about the $800 billion stimulus and the minimal impact that it has had. He believes Bernanke and Obama are merely buying borrowed time with borrowed money.

    The most interesting parts are when he quotes grim situations which highlight the depth of corruption in the government and big banks. In one instance, during the financial crisis of 2008, the Chairperson of the FDIC was "rarely consulted" and when she was, she was commanded: "you have to do this or the system will go down." There was "no analysis, no meaningful discussion." She expressed her frustration and explained that it became commonplace for her to be forced to carry out orders without being told the reasons or the end goals behind those orders. Generally, the government was unable to give reasons because they were acting on the whim of large banks. In another story, a head government official recounts the CEO of Goldman Sachs coercing him into providing the banks with bailout, lest their be dire consequences. The book has many shocking stories such as these. Each uncovers a different piece of corruption that, when added up, reveals a frightening picture of our government today.

    Pros:
    It was VERY detailed. There were countless facts and statistics to support his arguments and viewpoints.
    It provided a good snapshot into the inner workings of politics and government monetary policy.
    He provided factual stories and quotes throughout the book.
    He focused on many of the large power-players in our economy and their roles in the financial crashes.

    Cons:
    The book tended to jump from time period to time period. One moment it's about the Great Depression, and the next, it's current. It can make it difficult to follow at times. It also makes it difficult to review.
    It can be repetitive. Many of the things are said more than once or they are just reworded.
    It's a bit dry. Even with the stories and shocking data, I still found it hard to concentrate.

    [Aug 09, 2015] Hillary Clinton State Department Emails, Mexico Energy Reform, and the Revolving Door

    Notable quotes:
    "... By Steve Horn, a Madison, WI-based Research Fellow for DeSmogBlog and a freelance investigative journalist. He previously was a reporter and researcher at the Center for Media and Democracy. Originally published at DeSmogBlog . ..."
    "... Originally stored on a private server , with Clinton and her closest advisors using the server and private accounts, the emails confirm Clinton's State Department helped to break state-owned company Pemex 's (Petroleos Mexicanos) oil and gas industry monopoly in Mexico, opening up the country to international oil and gas companies. And two of the Coordinators helping to make it happen, both of whom worked for Clinton, now work in the private sector and stand to gain financially from the energy reforms they helped create. ..."
    "... The appearance of the emails also offers a chance to tell the deeper story of the role the Clinton-led State Department and other powerful actors played in opening up Mexico for international business in the oil and gas sphere. That story begins with a trio. ..."
    "... David Goldwyn , who was the first International Energy Coordinator named by Secretary of State Hillary Clinton in 2009, sits at the center of the story. As revealed by DeSmog, the State Department redacted the entire job description document for the Coordinator role. ..."
    "... The emails show that, on at least one instance, Goldwyn also used his private " [email protected] " (Goldwyn Global Strategies) email address for State Department business. ..."
    "... It remains unclear if he used his private or State Department email address on other instances, as only his name appears on the other emails. But Cheryl Mills, a top aide to Secretary Clinton at the time, initiated the email that he responded to on his private account. ..."
    naked capitalism
    By Steve Horn, a Madison, WI-based Research Fellow for DeSmogBlog and a freelance investigative journalist. He previously was a reporter and researcher at the Center for Media and Democracy. Originally published at DeSmogBlog.

    Emails released on July 31 by the U.S. State Department reveal more about the origins of energy reform efforts in Mexico. The State Department released them as part of the once-a-month rolling release schedule for emails generated by former U.S. Secretary of State Hillary Clinton, now a Democratic presidential candidate.

    Originally stored on a private server, with Clinton and her closest advisors using the server and private accounts, the emails confirm Clinton's State Department helped to break state-owned company Pemex's (Petroleos Mexicanos) oil and gas industry monopoly in Mexico, opening up the country to international oil and gas companies. And two of the Coordinators helping to make it happen, both of whom worked for Clinton, now work in the private sector and stand to gain financially from the energy reforms they helped create.

    The appearance of the emails also offers a chance to tell the deeper story of the role the Clinton-led State Department and other powerful actors played in opening up Mexico for international business in the oil and gas sphere. That story begins with a trio.

    The Trio

    David Goldwyn, who was the first International Energy Coordinator named by Secretary of State Hillary Clinton in 2009, sits at the center of the story. As revealed by DeSmog, the State Department redacted the entire job description document for the Coordinator role.

    Goldwyn now runs an oil and gas industry consulting firm called Goldwyn Global Strategies, works of counsel as an industry attorney at the law firm Sutherland Asbill & Brennan, and works as a fellow at the industryfunded think tanks Atlantic Council and Brookings Institution.

    The emails show that, on at least one instance, Goldwyn also used his private "[email protected] " (Goldwyn Global Strategies) email address for State Department business.

    It remains unclear if he used his private or State Department email address on other instances, as only his name appears on the other emails. But Cheryl Mills, a top aide to Secretary Clinton at the time, initiated the email that he responded to on his private account.

    [Aug 08, 2015] U.S. As Corrupt As Russia, Says Former NSA Exec By: Vikas Shukla

    August 06, 2015 | valuewalk.com

    In: Politics, Russia 41 Comments

    Americans believe that Russia is a corrupt country where everyone from the president to regional governors to government officials are flourishing on bribes. Russia has developed corruption into a "fine art," says a book titled "Putin's Kleptocracy: Who Owns Russia?" written by the University of Miami professor Karen Dawisha.

    U.S. fares far better than Russia on Corruption Perceptions Index

    In the absence of an efficient federal system, regional governors in Russia rule like mobsters. Moscow is also allegedly involved in the massive FIFA scandal. Americans and Europeans believe corruption in Russia is so widespread that when they imposed sanctions against Moscow following the annexation of Crimea, they also targeted "friends of Vladimir Putin" and rich oligarchs.

    John McCain has said in the past that Vladimir Putin rules by "corruption, repression, and violence." If you take a look at the Corruption Perceptions Index, the United States in ranked 17th while Russia comes at a distant 136th spot. Does that really mean the U.S. is far less corrupt than Russia? Probably not, says Jerome Israel, a former senior executive at NSA and the FBI.

    Jerome said in a column published in The Baltimore Sun that the legislation and behavior of the U.S. political class would open your eyes that the claims against Russia are hypocritical. For instance, last year's Cromnibus bill allows banks to undertake extremely risky investments. And if the banks suffer a huge loss, the American taxpayer gets the bill. Jerome says Congress has sold out the little guy to favor the K-Street lobbyists.

    Contrary to Russia, U.S. specializes in 'soft bribes'

    Another example is the trade pact currently under consideration by Congress. Details of the legislation are classified, and Americans don't know what's in it. Even a large number of lawmakers in Congress haven't read it. This is Soviet-style of lawmaking, says Jerome Israel.

    Recently, CNN reported that at least 78 members of Congress have their family members as federally registered lobbyists. According to congressional watchdog Legistrom, these lobbyists have lobbied contracts worth over $2 billion. While corruption and bribery are prevalent in Russia, the U.S. specializes in "soft bribes." It's like you take care of the lawmakers' families and they will take good care of you. These "pay-to-play" schemes make it hard to understand how American politicians are better than their Russian counterparts.

    Like this article? Sign up for our free newsletter to get articles delivered to your inbox

    [Jul 27, 2015] Why Debt Sustains Corruption and Vice Versa by Christos Koulovatianos

    This guy is a neocon stooge and promotes neoliberal theory of corruption... He completely avoid the theme of corruption and tax avoidance of multinationals as well as the role London, Zurich and other G7 capitals as well as New York play as safe heaven for local crooks. The role of global banking system as enabler of corruption is also avoided.
    July 21, 2015 | nakedcapitalism.com

    Yves here. This post makes some important observations about how the elite levels of Greece engage in rent-seeking, aka corruption, and can continue those strategies even in the face of economic collapse, to the detriment to the rest of Greek society. It's an important counter-frame because many accounts of what has happened in Greece fails to take sufficient account of the role of parties within Greece of profiting despite increasing desperation overall.

    One can correctly point out that that focus leads the authors to place too much confidence in cleaning up tax evasion and other "reforms" focused on rentier behavior as having enough impact to get Greece out of its very deep economic ditch. But I trust readers have the sophistication to read past those parts and focus on the analysis, particularly since advanced economies like the US are at an earlier stage of slipping down the corruption slope.

    By Christos Koulovatianos, Professor in Macroeconomics, University of Luxembourg and John Tsoukalas, Associate Professor (Reader) in Macroeconomics, Adam Smith Business School, University of Glasgow. Originally published at VoxEU

    As numerous Greek MEPs opposed the Eurozone summit deal, implementation will require a broad coalition of political parties. This column argues that corruption in Greek politics will prevent the formation of such a coalition. The heavy debt service leads parties to invent extreme ways of responding to super-austerity and to strongly oppose direct reforms that challenge existing clientelism. The way out is to sign a new agreement that combines debt restructuring and radical transparency reforms, including naming-and-shaming practices, to block clientelism in the medium and long run.

    Corruption is typically unobserved in formal data, so it is difficult to document its extent. Since the work of Schattschneider (1935), theories of rent seeking and corrupt legislative bargaining – further developed by Ferejohn (1986) and Persson (1998), and outlined in the book by Persson and Tabellini (2000) – link up the observable effects of corruption to rent-extraction mechanisms. These theories help in estimating rents, but we are unaware of a study that obtains such estimates for Greece. Nevertheless, everyday life in Greece suggests that clientelistic goods traded by political parties include examples such as:

    • Civil-servant jobs, for which devoted party members can put in less effort at work, and for which party members may be underqualified.
    • Tax evasion, with parties supporting networks of non-transparency through insiders in public authorities.
    • Preferential legal treatment using a partisan network of underreporting through public authorities.
    • Privileges regarding the management of real estate.
    • Fiscal over-invoicing.
    • Wasteful public infrastructure related to private benefits, such as building roads leading to specific private properties against city-plan efficiency.
    • Fraud in granting disability benefits (Angelos 2012), etc.

    Corruption in Greece Relative to Other Eurozone countries, and Its Fiscal Profligacy Problem

    Figure 1 plots the Corruption Perceptions Index (CPI) against the average fiscal surplus between 1996-2010. As can also be seen in Table 1, Greece is one of the countries with the highest corruption (CPI) scores. According to Figure 1, Greece is certainly the Eurozone's outlier in terms of fiscal profligacy. Fiscal surplus to GDP ratios have a correlation coefficient of 73% with the CPI, revealing that corruption is strongly related to fiscal profligacy. Achury et al. (2015) provide a theoretical analysis suggesting a two-sided causality between fiscal profligacy and corruption if a country's debt-to-GDP ratio is too high (beyond 137%). In that case, a country can be trapped in a vicious circle of corruption and fiscal profligacy that ultimately leads to default. The key to this vicious circle spiral is the unwillingness of rent-seeking groups to cooperate on reforms and on minimum fiscal prudence.

    Figure 1 Correlation between the fiscal-surplus/GDP ratio (in percentage points) and the Corruption-Perceptions Index (CPI) for Eurozone countries (t-statistics in parentheses).

    Tsoukalas-fog
    Note: For Cyprus, Estonia, Malta, Slovakia and Slovenia averages are calculated since four years prior to joining the Eurozone.
    Sources: Eurostat, Transparency International; figure taken from Achury et al. (2015).

    Table 1 Corruption Perception Index (CPI)

    Tsoukalas-table

    Note: Higher score means lower corruption and numbers appearing in parentheses next to each score is the country's world-corruption raking based on the score in each particular year.
    Source: Transparency International; table taken from the Online Appendix of Achury et al. (2015).

    Why Cooperation Among Political Parties Matters for Reform Implementation

    The immediate argument in favour of broad coalition governments is that policy reforms and austerity have a high political cost. Cooperation among parties can make them share the political cost. In addition, a broad consensus among parties provides credibility to society concerning technocrat-expert suggestions for solving the fiscal profligacy problem. From the very beginning of the sovereign crisis in the Eurozone, the IMF has provided explicit guidelines in favour of broad coalition governments or for cooperation across parties (see International Monetary Fund, 2010a-d, 2011a-f, and 2012a-f for specific sentences expressing these IMF guidelines).1

    In the case of Greece, coalition governments have never been broad across parties, and reforms have progressed slowly, despite the intense monitoring by the IMF (Campos and Coricelli 2015). According to the theory suggested by Achury et al. (2015), the corruption problem in Greece, combined with its high debt-to-GDP ratio, has led Greece into a trap.

    What Causes the Corruption-Debt Trap in Greece?

    According to the approach of Achury et al. (2015), corrupt political parties in Greece tend to act as rent-seeking groups through the provision of clientelistic goods described above. Cooperation on reforms and austerity measures is a typical coordination game. If the partisan benefits from cooperation exceed the partisan benefits from non-cooperation, then two equilibria are possible: cooperation and non-cooperation, with the latter being the result of bad coordination. If, however, the partisan benefits of non-cooperation exceed those of cooperation, even for one big party, then there is only one sure outcome: non-cooperation (Achury et al. 2015, Section 1.1).

    The high cost of servicing the enormous outstanding debt in Greece simply makes non-cooperation more profitable for parties. If parties cooperate, they face a high cost of servicing the debt, especially due to the tight fiscal-surplus requirements. This fiscal burden makes party members think that a partial default and a gang war for rents is more profitable for them, even in a state of economic chaos. This strategic speculation keeps Greece in a trap, because non-cooperating rent-seeking groups engage into a tragedy-of-the-commons equilibrium of excessive rent seeking. Markets pre-calculate the implied fiscal profligacy, Grexit scenarios return with positive probability, investment becomes discouraged, and the debt-to-GDP ratio increases due to a shrinking economy (Greece has lost 26% of its 2008 GDP until year 2014).

    The Short-Run Solution and the Long-Run Solution for Escaping the Political Infeasibility Trap: A Synthesis

    The ideal long-run solution to Greece's problem would be to eradicate rent-seeking groups in politics. However, this requires time and a deep understanding of the problem. The short-run solution would be to restructure Greek debt, postponing payments and giving enough time for economic recovery. This short-run strategy could make benefits from a broad-coalition government more attractive to political parties, because it would take away the debt-servicing burden. The working hypothesis is that some rent-seeking activities would still be speculated by parties (Achury et al. 2015, Sections 2.5, 3.1.2, and 3.1.4).

    Of course, such debt restructuring requires a new agreement. And certainly the EU should ask for reforms in exchange for debt restructuring. Whether these reforms could solve the corruption problem (or not) in the long run, is a matter of understanding the roots of the corruption problem in Greek society.
    The vast majority of Greek citizens are not corrupt: Corruption is a social coordination problem leading to a prisoner's dilemma

    A small but critical mass of citizens and politicians break the rules of fair play and equitability against the law. Businesses that do not pay their taxes oblige other businesses to do the same in order to survive competition. Skilled young people who apply for civil servant jobs are obliged to invest in clientelistic political connections, after seeing inapt persons obtaining such jobs. Citizens see their taxes ending up in the private pockets of people they know, but are unlikely to win a court case because of the political support for involved persons. Lawful citizens, knowing that taxes will not finance public goods but private benefits, are unwilling to pay their income taxes, becoming friendly to parties that promise lenience regarding tax collection.

    The list can go on and on, but the issue is not morality. It is the technical perils of a coordination problem that ends up in prisoner's dilemma situations that arise in everyday life. The sad equilibrium is that Greek citizens do not feel equal among equals against taxpayer law. A feeling of social mistrust pervades citizens, especially young people.

    Can society and the partisan network of vividly supporting voters and politicians bring reforms to Greece? This is not likely, unless a key reform is implemented first: transparency. Greece can innovate on that front, making use of information technologies.

    Basic Things About Transparency First

    A key transparency reform is to put every Greek citizen's existing personal data into a centralised database. Currently, such data are scattered across different public authorities, a strategy that is most likely intentional. This strategy has led to frivolities with tragic fiscal consequences. An example is the famous disability fraud of certified taxi drivers receiving blindness disability aid in the island of Zakynthos (Angelos 2012). Because of the radical nature of this reform, it is crucial to protect privacy rights in the transition phase.

    A Careful 'Name and Shame' Transparency Act

    Another key transparency reform would be to list the names of all Greek citizens on the web, explaining who has paid all taxes, and if not, the stated reason why. This act should fully protect personal data, such as income and wealth records, exactly because political rent seekers inside and outside Greece may attempt to confiscate wealth through ad hoc bail-in acts. If implemented correctly, this reform is most likely to convince Greek citizens that everyone is equal among equals against taxpayer law. This sense of equality can lead to a new social contract that can fight clientelism and pork-barrel politics, restore social trust, and bring policy certainty. In turn, policy certainty can give confidence to domestic and foreign investors to unlock Greece's potential for innovation and growth.

    Conclusion

    The implementation of the 'aGreekment' reached on 13 July 2015, after a 17-hour Eurogroup summit, needs a broad coalition government in Greece. The urgent and necessary political cooperation among parties is unlikely to be forthcoming. Political parties have rent-seeking agendas that are crowded out by the burden of servicing the debt. This is a trap.

    To escape this trap, we suggest an urgent additional agreement. Drastic debt restructuring (postponing debt maturity) should be exchanged with immediate implementation of radical transparency reforms that aim at eradicating corruption. Debt restructuring should convince rent-seeking political parties that it is more profitable to cooperate. In the short run, parties could keep a small part of their rent-seeking activities, while servicing a smaller, manageable amount of debt.

    It is impossible to instantly reverse the momentum of political corruption in Greece, but it is urgent that parties first cooperate on implementing simple and basic transparency reforms. In the beginning, the political cost of implementing these transparency reforms will be low. In the medium and long run, transparency can raise the feeling of equitability among citizens. This feeling can encourage Greek society to move away from supporting rent-seeking parties and to demand governments with public-resource management skills.

    See orignal post for references

    [Jul 24, 2015] How neoliberalism created an age of activism by Juan Cole

    15 Nov 2011 |

    Decades of neoliberal economic policies have concentrated wealth and are now spurring a global backlash.

    Politics, US & Canada, Latin America, Chile, Egypt

    ANN ARBOR, MICHIGAN - From Tunis to Tel Aviv, Madrid to Oakland, a new generation of youth activists is challenging the neoliberal state that has dominated the world ever since the Cold War ended. The massive popular protests that shook the globe this year have much in common, though most of the reporting on them in the mainstream media has obscured the similarities.

    Whether in Egypt or the United States, young rebels are reacting to a single stunning worldwide development: the extreme concentration of wealth in a few hands thanks to neoliberal policies of deregulation and union busting. They have taken to the streets, parks, plazas and squares to protest against the resulting corruption, the way politicians can be bought and sold, and the impunity

    ANN ARBOR, MICHIGAN - From Tunis to Tel Aviv, Madrid to Oakland, a new generation of youth activists is challenging the neoliberal state that has dominated the world ever since the Cold War ended. The massive popular protests that shook the globe this year have much in common, though most of the reporting on them in the mainstream media has obscured the similarities.

    Whether in Egypt or the United States, young rebels are reacting to a single stunning worldwide development: the extreme concentration of wealth in a few hands thanks to neoliberal policies of deregulation and union busting. They have taken to the streets, parks, plazas and squares to protest against the resulting corruption, the way politicians can be bought and sold, and the impunity of the white-collar criminals who have run riot in societies everywhere. They are objecting to high rates of unemployment, reduced social services, blighted futures and above all the substitution of the market for all other values as the matrix of human ethics and life.

    Pasha the Tiger

    In the "glorious thirty years" after World War II, North America and Western Europe achieved remarkable rates of economic growth and relatively low levels of inequality for capitalist societies, while instituting a broad range of benefits for workers, students and retirees. From roughly 1980 on, however, the neoliberal movement, rooted in the laissez-faire economic theories of Milton Friedman, launched what became a full-scale assault on workers' power and an attempt, often remarkably successful, to eviscerate the social welfare state.

    Neoliberals chanted the mantra that everyone would benefit if the public sector were privatised, businesses deregulated and market mechanisms allowed to distribute wealth. But as economist David Harvey argues, from the beginning it was a doctrine that primarily benefited the wealthy, its adoption allowing the top one per cent in any neoliberal society to capture a disproportionate share of whatever wealth was generated.

    In the global South, countries that gained their independence from European colonialism after World War II tended to create large public sectors as part of the process of industrialisation. Often, living standards improved as a result, but by the 1970s, such developing economies were generally experiencing a levelling-off of growth. This happened just as neoliberalism became ascendant in Washington, Paris and London as well as in Bretton Woods institutions like the International Monetary Fund. This "Washington consensus" meant that the urge to impose privatisation on stagnating, nepotistic postcolonial states would become the order of the day.

    Egypt and Tunisia, to take two countries in the spotlight for sparking the Arab Spring, were successfully pressured in the 1990s to privatise their relatively large public sectors. Moving public resources into the private sector created an almost endless range of opportunities for staggering levels of corruption on the part of the ruling families of autocrats Zine El Abidine Ben Ali in Tunis and Hosni Mubarak in Cairo. International banks, central banks and emerging local private banks aided and abetted their agenda.

    It was not surprising then that one of the first targets of Tunisian crowds in the course of the revolution they made last January was the Zitouna bank, a branch of which they torched. Its owner? Sakher El Materi, a son-in-law of President Ben Ali and the notorious owner of Pasha, the well-fed pet tiger that prowled the grounds of one of his sumptuous mansions. Not even the way his outfit sought legitimacy by practicing "Islamic banking" could forestall popular rage. A 2006 State Department cable released by WikiLeaks observed, "One local financial expert blames the [Ben Ali] Family for chronic banking sector woes due to the great percentage of non-performing loans issued through crony connections, and has essentially paralysed banking authorities from genuine recovery efforts." That is, the banks were used by the regime to give away money to his cronies, with no expectation of repayment.

    Tunisian activists similarly directed their ire at foreign banks and lenders to which their country owes $14.4bn. Tunisians are still railing and rallying against the repayment of all that money, some of which they believe was borrowed profligately by the corrupt former regime and then squandered quite privately.

    Tunisians had their own one per cent, a thin commercial elite, half of whom were related to or closely connected to President Ben Ali. As a group, they were accused by young activists of mafia-like, predatory practices, such as demanding pay-offs from legitimate businesses, and discouraging foreign investment by tying it to a stupendous system of bribes. The closed, top-heavy character of the Tunisian economic system was blamed for the bottom-heavy waves of suffering that followed: cost of living increases that hit people on fixed incomes or those like students and peddlers in the marginal economy especially hard.

    It was no happenstance that the young man who immolated himself and so sparked the Tunisian rebellion was a hard-pressed vegetable peddler. It's easy now to overlook what clearly ties the beginning of the Arab Spring to the European Summer and the present American Fall: the point of the Tunisian revolution was not just to gain political rights, but to sweep away that one per cent, popularly imagined as a sort of dam against economic opportunity.

    Tahrir Square, Zuccotti Park, Rothschild Avenue

    The success of the Tunisian revolution in removing the octopus-like Ben Ali plutocracy inspired the dramatic events in Egypt, Libya, Yemen, Syria and even Israel that are redrawing the political map of the Middle East. But the 2011 youth protest movement was hardly contained in the Middle East. Estonian-Canadian activist Kalle Lasn and his anti-consumerist colleagues at the Vancouver-based Adbusters Media Foundation were inspired by the success of the revolutionaries in Tahrir Square in deposing dictator Hosni Mubarak.

    Their organisation specialises in combatting advertising culture through spoofs and pranks. It was Adbusters magazine that sent out the call on Twitter in the summer of 2011 for a rally at Wall Street on September 17, with the now-famous hash tag #OccupyWallStreet. A thousand protesters gathered on the designated date, commemorating the 2008 economic meltdown that had thrown millions of Americans out of their jobs and their homes. Some camped out in nearby Zuccotti Park, another unexpected global spark for protest.

    The Occupy Wall Street movement has now spread throughout the United States, sometimes in the face of serious acts of repression, as in Oakland, California. It has followed in the spirit of the Arab and European movements in demanding an end to special privileges for the richest one per cent, including their ability to more or less buy the US government for purposes of their choosing. What is often forgotten is that the Ben Alis, Mubaraks and Gaddafis were not simply authoritarian tyrants. They were the one per cent and the guardians of the one per cent, in their own societies - and loathed for exactly that.

    Last April, around the time that Lasn began imagining Wall Street protests, progressive activists in Israel started planning their own movement. In July, sales clerk and aspiring filmmaker Daphne Leef found herself unable to cover a sudden rent increase on her Tel Aviv apartment. So she started a protest Facebook page similar to the ones that fuelled the Arab Spring and moved into a tent on the posh Rothschild Avenue where she was soon joined by hundreds of other protesting Israelis. Week by week, the demonstrations grew, spreading to cities throughout the country and culminating on September 3 in a massive rally, the largest in Israel's history. Some 300,000 protesters came out in Tel Aviv, 50,000 in Jerusalem and 40,000 in Haifa. Their demands included not just lower housing costs, but a rollback of neoliberal policies, less regressive taxes and more progressive, direct taxation, a halt to the privatisation of the economy, and the funding of a system of inexpensive education and child care.

    Many on the left in Israel are also deeply troubled by the political and economic power of right-wing settlers on the West Bank, but most decline to bring the Palestinian issue into the movement's demands for fear of losing support among the middle class. For the same reason, the way the Israeli movement was inspired by Tahrir Square and the Egyptian revolution has been downplayed, although "Walk like an Egyptian" signs - a reference both to the Cairo demonstrations and the 1986 Bangles hit song - have been spotted on Rothschild Avenue.

    Most of the Israeli activists in the coastal cities know that they are victims of the same neoliberal order that displaces the Palestinians, punishes them and keeps them stateless. Indeed, the Palestinians, altogether lacking a state but at the complete mercy of various forms of international capital controlled by elites elsewhere, are the ultimate victims of the neoliberal order. But in order to avoid a split in the Israeli protest movement, a quiet agreement was reached to focus on economic discontents and so avoid the divisive issue of the much-despised West Bank settlements.

    There has been little reporting in the Western press about a key source of Israeli unease, which was palpable to me when I visited the country in May. Even then, before the local protests had fully hit their stride, Israelis I met were complaining about the rise to power of an Israeli one per cent. There are now 16 billionaires in the country, who control $45bn in assets, and the current crop of 10,153 millionaires is 20 per cent larger than it was in the previous fiscal year. In terms of its distribution of wealth, Israel is now among the most unequal of the countries in the Organisation for Economic Cooperation and Development. Since the late 1980s, the average household income of families in the bottom fifth of the population has been declining at an annual rate of 1.1 per cent. Over the same period, the average household income of families among the richest 20 per cent went up at an annual rate of 2.4 per cent.

    While neoliberalism has produced more unequal societies throughout the world, nowhere else has the income of the poor declined quite so strikingly. The concentration of wealth in a few hands profoundly contradicts the founding principles of Israel's Labour Zionism, and results from decades of right-wing Likud policies punishing the poor and middle classes and shifting wealth to the top of society.

    The indignant ones

    European youth were also inspired by the Tunisians and Egyptians - and by a similar flight of wealth. I was in Barcelona on May 27, when the police attacked demonstrators camped out at the Placa de Catalunya, provoking widespread consternation. The government of the region is currently led by the centrist Convergence and Union Party, a moderate proponent of Catalan nationalism. It is relatively popular locally, and so Catalans had not expected such heavy-handed police action to be ordered. The crackdown, however, underlined the very point of the protesters, that the neoliberal state, whatever its political makeup, is protecting the same set of wealthy miscreants.

    Spain's "indignados" (indignant ones) got their start in mid-May with huge protests at Madrid's Puerta del Sol Plaza against the country's persistent 21 per cent unemployment rate (and double that among the young). Egyptian activists in Tahrir Square immediately sent a statement of warm support to those in the Spanish capital (as they would months later to New York's demonstrators). Again following the same pattern, the Spanish movement does not restrict its objections to unemployment (and the lack of benefits attending the few new temporary or contract jobs that do arise). Its targets are the banks, bank bailouts, financial corruption and cuts in education and other services.

    Youth activists I met in Toledo and Madrid this summer denounced both of the country's major parties and, indeed, the very consumer society that emphasised wealth accumulation over community and material acquisition over personal enrichment. In the past two months Spain's young protesters have concentrated on demonstrating against cuts to education, with crowds of 70,000 to 90,000 coming out more than once in Madrid and tens of thousands in other cities. For marches in support of the Occupy Wall Street movement, hundreds of thousands reportedly took to the streets of Madrid and Barcelona, among other cities.

    The global reach and connectedness of these movements has yet to be fully appreciated. The Madrid education protesters, for example, cited for inspiration Chilean students who, through persistent, innovative, and large-scale demonstrations this summer and fall, have forced that country's neoliberal government, headed by the increasingly unpopular billionaire president Sebastian Pinera, to inject $1.6bn in new money into education. Neither the crowds of youth in Madrid nor those in Santiago are likely to be mollified, however, by new dorms and laboratories. Chilean students have already moved on from insisting on an end to an ever more expensive class-based education system to demands that the country's lucrative copper mines be nationalised so as to generate revenues for investment in education. In every instance, the underlying goal of specific protests by the youthful reformists is the neoliberal order itself.

    The word "union" was little uttered in American television news coverage of the revolutions in Tunisia and Egypt, even though factory workers and sympathy strikes of all sorts played a key role in them. The right-wing press in the US actually went out of its way to contrast Egyptian demonstrations against Mubarak with the Wisconsin rallies of government workers against Governor Scott Walker's measure to cripple the bargaining power of their unions.

    The Egyptians, Commentary typically wrote, were risking their lives, while Wisconsin's union activists were taking the day off from cushy jobs to parade around with placards, immune from being fired for joining the rallies. The implication: the Egyptian revolution was against tyranny, whereas already spoiled American workers were demanding further coddling.

    The American right has never been interested in recognising this reality: that forbidding unions and strikes is a form of tyranny. In fact, it wasn't just progressive bloggers who saw a connection between Tahrir Square and Madison. The head of the newly formed independent union federation in Egypt dispatched an explicit expression of solidarity to the Wisconsin workers, centering on worker's rights.

    At least, Commentary did us one favour: it clarified why the story has been told as it has in most of the American media. If the revolutions in Tunisia, Egypt and Libya were merely about individualistic political rights - about the holding of elections and the guarantee of due process - then they could be depicted as largely irrelevant to politics in the US and Europe, where such norms already prevailed.

    If, however, they centered on economic rights (as they certainly did), then clearly the discontents of North African youth when it came to plutocracy, corruption, the curbing of workers' rights, and persistent unemployment deeply resembled those of their American counterparts.

    The global protests of 2011 have been cast in the American media largely as an "Arab Spring" challenging local dictatorships - as though Spain, Chile and Israel do not exist. The constant speculation by pundits and television news anchors in the US about whether "Islam" would benefit from the Arab Spring functioned as an Orientalist way of marking events in North Africa as alien and vaguely menacing, but also as not germane to the day to day concerns of working Americans. The inhabitants of Zuccotti Park in lower Manhattan clearly feel differently.

    Facebook flash mobs

    If we focus on economic trends, then the neoliberal state looks eerily similar, whether it is a democracy or a dictatorship, whether the government is nominally right of centre or left of centre. As a package, deregulation, the privatisation of public resources and firms, corruption and forms of insider trading and interference in the ability of workers to organise or engage in collective bargaining have allowed the top one per cent in Israel, just as in Tunisia or the US, to capture the lion's share of profits from the growth of the last decades.

    Observers were puzzled by the huge crowds that turned out in both Tunis and Tel Aviv in 2011, especially given that economic growth in those countries had been running at a seemingly healthy five per cent per annum. "Growth", defined generally and without regard to its distribution, is the answer to a neoliberal question. The question of the 99 per cent, however, is: Who is getting the increased wealth? In both of those countries, as in the US and other neoliberal lands, the answer is: disproportionately the one per cent.

    If you were wondering why outraged young people around the globe are chanting such similar slogans and using such similar tactics (including Facebook "flash mobs"), it is because they have seen more clearly than their elders through the neoliberal shell game.

    Juan Cole is the Richard P. Mitchell Professor of History and the director of the Centre for South Asian Studies at the University of Michigan. His latest book, Engaging the Muslim World, is just out in a revised paperback edition from Palgrave Macmillan. He runs the Informed Comment website.

    A version of this article was first published on Tom Dispatch.

    The views expressed in this article are the author's own and do not necessarily reflect Al Jazeera's editorial policy.

    PTI's idea of corruption - Farooq Sulehria

    "...By blaming under-development on corruption alone, the anti-corruption crusaders at World Bank and IMF do not want to look at the structural inequalities globally or locally. Without taking into account the international political economy, colonial history and neo-colonial perspectives the international anti-corruption establishment whitewashes the role of imperialism."

    Anti-corruption is a relatively new discourse that began to proliferate global development discourses in the mid-1990s. During the mid-1990s, the UN, IMF, World Bank, OECD besides NGOs and western aid agencies, such as the UK's Department for International Development (DfId) began their jihad on corruption. Portals such as Coris and Ancor also emerged besides NGOs such as Transparency International. Now with chapters in 85 countries, Transparency International manages a budget worth six million euros. It has also worked in close collaboration with the World Bank. At least four members on its board of directors formerly also held top position in the World Bank besides a few others in its secretariat. Ironically, during the Cold War, liberal developmentalist theoreticians were glorifying the role of corruption in stimulating growth in the countries of South. Samuel Huntington, for instance, thought: "In terms of economic growth, the only thing worse than a society with a rigid, over-centralised, dishonest bureaucracy is one with a rigid, over-centralised, honest bureaucracy". Why did anti-corruption became a global jihad only in the post-Cold War period? One scholar on the topic, Elizabeth Harrison offers two explanations. On the one hand, there are those who strongly believe that corruption is the cause of all the ills. On the other hand, there is a set of scholars viewing anti-corruption discourse as an attempt to divert attention from the failure of structural adjustment programmes and as a manifestation of a neoliberal policy agenda. For them, anti-corruption is closely linked with the governance agenda in development providing a pretext for greater neoliberal intrusion in foreign aid. The answer, says Harrison, lies somewhere in between: "Corruption does exist and its pre-eminence in international discourse is not innocent of neoliberal values…Like all discourses, that of anti-corruption does not exist in an institutional vacuum". It is used and developed, she thinks, by particular actors therefore we need to look at the anti-corruption establishment and the way they frame the problem. By blaming under-development on corruption alone, the anti-corruption crusaders at World Bank and IMF do not want to look at the structural inequalities globally or locally. Without taking into account the international political economy, colonial history and neo-colonial perspectives the international anti-corruption establishment whitewashes the role of imperialism. Equally problematic is the definition of corruption. For instance, the debt trap for the third world, the international division of labour, and many other forms of structured exploitation pose no development dilemmas to anti-corruption crusaders. These one-dimensional neoliberal anti-corruption discourse whereby corruption is the root cause of all third-world problems has been adopted by neoliberal politicians and intelligentsia in many third world countries. The PTI, captained by Imran Khan, for instance, has unproblematically adopted the World Bank discourse on corruption and anti-corruption. Corruption in PTI narratives refers to the use of public office for private gains or breach of law (tax evasion, for instance). This is, in fact, standard liberal definition. The way this over-simplified definition rids World Bank and its cousins from the responsibility they should bear for destroying Africa, this definition also helps the PTI avoid 'awkward' positions. For instance, class perks of the feudal lords, pirs (two of them occupying leadership positions in the PTI), or capitalist exploitation do not constitute corruption in PTI manifesto. Likewise, for the PTI, institutionalised grabs by the civil and military bureaucracy do not merit being called corruption. Private education and medical care fail to pose any problem either. National oppression, Balochistan notwithstanding, is also an alien concept for the PTI. Hence, the system that generates an atmosphere for corruption is not questioned. Understandably, the way the World Bank has failed Africa, the PTI is failing Khyber Pakhtunkhwa. The writer is a freelance contributor.

    Neoliberalism and Corruption

    Sunday, August 17, 2008

    Neoliberalism and Corruption

    Friends and colleagues, from their origins in the 1940s, the IMF and World Bank have functioned as built-in systemic mechanism of neoliberalism; both are - in the words of Woods, 1989 - opposing not only socialism but national capitalism as well, in favor of the progressive extension of international market forces. Both institutions play significant roles in the social construction of global market economies. However, in doing so, they produce policies that encourage corruption in various economies. Well, nonetheless World Bank battles corruption - but only in some countries. The following are articles that highlighted the issue .

    IMF and World Bank Policies that Encourage Corruption by Anup Shah http://www.globalissues.org/article/590/corruption#IMFandWorldBankPoliciesthatEncourageCorruption 23 September 2007 . . . At a deeper level are the policies that form the backbone to globalization. These policies are often prescribed by international institutions such as the World Bank and IMF. For years, they have received sharp criticism for exacerbating poverty through policies such as Structural Adjustment, rapid deregulation and opening barriers to trade before poorer countries are economic ready to do so. This has also created situations ripe for corruption to flourish: As Western governments and the World Bank and IMF shout ever more loudly about corruption, their own policies are making it worse in both North and South. Particularly at fault are deregulation, privatization, and structural adjustment policies requiring civil service reform and economic liberalization. In 1997, the World Bank asserted that: any reform that increases the competitiveness of the economy will reduce incentives for corrupt behavior. Thus policies that lower controls on foreign trade, remove entry barriers to private industry, and privatize state firms in a way that ensure competition will all support the fight. The Bank has so far shown no signs of taking back this view. It continues to claim that corruption can be battled through deregulation of the economy; public sector reform in areas such as customs, tax administration and civil service; strengthening of anti-corruption and audit bodies; and decentralization. Yet the empirical evidence, much of it from the World Bank itself, suggests that, far from reducing corruption, such policies, and the manner in which they have been implemented, have in some circumstances increased it. - Dr Susan Hawley, Exporting Corruption; Privatization, Multinationals and Bribery, The Corner House, June 2000 Jubilee Research (formerly the prominent Jubilee 2000 debt relief campaign organization) has similar criticisms, and is also worth quoting at length: Rich country politicians and bank officials argue that because dictators like Marcos, Suharto, and Mobutu were kept in power with western arms and were given loans to squander on ill-judged and repressive schemes, that the people of those countries-who often fought valiantly against those dictators-cannot be trusted not to waste the money released by debt cancellation. This may seem confusing to people not familiar with the logic of the IMF and World Bank. In summary: Creditors colluded with, and gave loans to dictators they knew were corrupt and who would squander the money. Creditors gave military and political aid to those dictators-knowing arms might be used to suppress popular opposition Therefore, successor democratic governments and their supporters, who may have been victims of corruption and oppression, cannot be trusted. To many people in the South, this seems irrational and illogical-the logic of blaming the victim. It is the logic of power rather than of integrity, and is used to benefit the rich rather than the poor in developing countries. A similar logic argues that if the World Bank and government export credit agencies promoted inappropriate and unprofitable projects, then southern governments proved their inability to control money because they accepted the ill-advised projects in the first place. Thus, if money is released by debt cancellation, it must be controlled by agencies which promoted those failed projects. This is the logic that says if people were stupid enough to believe cigarette advertising, then they are too stupid to take care of themselves and the "reformed" cigarette companies should be put in charge of their health care. The same institutions who made the corrupt loans to Zaire and lent for projects in Africa that failed repeatedly are still in charge, but their role has been enhanced because of their success in pushing loans. Can we trust these institutions to suddenly only lend wisely; to not give loans when the money might be wasted? Preventing new wasted loans and new debt crises, and ensuring that there is not another debt crisis, means that the people who pushed the loans and caused this crisis cannot be left in charge. The creditors or loan pushers cannot be left in charge, no matter how heartfelt their protestations that they have changed. Pushers and addicts need to work together, to bring to an end the entire reckless and corrupt lending and borrowing habit. - Joseph Hanlon and Ann Pettifor, Kicking the Habit; Finding a lasting solution to addictive lending and borrowing-and its corrupting side-effects, Jubilee Research, March 2000 And in terms of how lack of transparency by the international institutions contributes to so much corruption structured into the system, Hanlon and Pettifor continue in the same report as cited above: Structural adjustment programs cover most of a country's economic governance. … The most striking aspect of IMF/World Bank conditionality [for aid, debt relief, etc] is that the civil servants of these institutions, the staff members, have virtual dictatorial powers to impose their whims on recipient countries. This comes about because poor countries must have IMF and World Bank programs, but staff can decline to submit programs to the boards of those institutions until the poor country accepts conditions demanded by IMF civil servants. There is much talk of transparency and participation, but the crunch comes in final negotiations between ministers and World Bank and IMF civil servants The country manager can say to the Prime Minister, "unless you accept condition X, I will not submit this program to the board". No agreed program means a sudden halt to essential aid and no debt relief, so few ministers are prepared to hold out. Instead Prime Ministers and presidents bow to the diktat of foreign civil servants. Joseph Stiglitz also notes that "reforms often bring advantages to some groups while disadvantaging others," and one of the problems with policies agreed in secret is that a governing elite may accept an imposed policy which does not harm the elite but harms others. An example is the elimination of food subsidies. - Joseph Hanlon and Ann Pettifor, Kicking the Habit; Finding a lasting solution to addictive lending and borrowing-and its corrupting side-effects, Jubilee Research, March 2000 As further detailed by Hanlon and Pettifor, Christian Aid partners (a coalition of development organizations), argued that top-down "conditionality has undermined democracy by making elected governments accountable to Washington-based institutions instead of to their own people." The potential for unaccountability and corruption therefore increases as well. http://www.thestreetspirit.org/June2006/bank.htm

    World Bank battles corruption - but only in some countries. Observing the struggles of its sister organization (the IMF), the World Bank has taken a proactive approach to its own crisis of legitimacy by considering extending invitations to Mexico, Turkey, South Korea and China to become full voting members. The World Bank is also investing $30 million in a public relations campaign in an effort to position itself as the premiere lending institution for global efforts to end poverty, protect the environment and address the global AIDS pandemic, as well as to reiterate that it is the world's largest "development" research organization. At the heart of this new media campaign is World Bank President Paul Wolfowitz's new anti-corruption campaign. Given Wolfowitz's recent history as the architect of the Iraq war and occupation - an undertaking literally drowning under allegations of mismanagement and nepotism - many see this anti-corruption campaign as grossly hypocritical. Many African leaders have long said that they need Western institutions to aid them in rooting out corruption and ensure transparent governance, since international institutions based in the Global North are complicit in corruption. Recently, European countries have pressured Wolfowitz to put greater emphasis on building institutions to fight corruption in the developing world, rather than simply suspending loans where corruption is suspected. As a result, he began working with shareholders to develop a framework to fight and monitor corruption. The framework will be considered at the next IMF/WB meetings in the Fall of 2006 in Singapore. While welcoming this needed reform, many argue that the World Bank is not applying the same scrutiny to Iraq and Indonesia (where Wolfowitz worked prior to his work in the Bush administration) that is being applied to Chad and the Democratic Republic of Congo. In January, the World Bank cut off $124 million in loans after Chad changed its laws to siphon oil pipeline revenues away from anti-poverty programs; and in March, the Bank imposed rigid conditions on Congo's oil-exporting capacity. The World Bank maintains that Chad, Congo and Sudan may all be eligible for debt relief in the coming months, provided they show proof of economic stability and government reform. Civil society reactions Addressing corruption and the need for basic standards applied to loans and disbursements has been one of the main campaign points of civil society in the Global South for the last 30 years. Campaigners are pleased to see the financial institutions that are the source of so much corruption taking this life-threatening issue seriously. However, ensuring that debt-servicing funds are properly reallocated to address human needs (education, health, etc.) is a process that must involve partnerships between civil society and governments in indebted countries. This process cannot be achieved solely vis-a-vis international institutions. At present, there are seven international bodies that address accountability and transparency in international fund management. If the World Bank wants to add itself to this list, there must first be a proper analysis of why these existing institutions and bodies have not been wholly effective.

    Liberalism, Neoliberalism and Corruption a Critical Genealogy

    Attempting to determine a relationship between any independent variable and the phenomenon termed "corruption" is difficult, given the nebulousness of the concepts and the difficulties in establishing causation as opposed to correlation (Ali & Isse 2003). When dealing with the concept of "liberalism", covering the spectrum from political to economic freedoms, it becomes an even more delicate endeavour since "Liberalism is about as slippery as a political term can be" (Crouch 2011) and "liberty" is more often than not a rhetorical device. However, since it is the dominant political and economic framework of contemporary society, a critical overview of how it can be understood in relation to corruption is illuminating. For the purposes of this essay, "corruption" will be defined as a problematic conflict-of-interest between the individual's obligation to themselves, the state and the market. These overlapping fields, however, will be examined closely in light of liberal thought and tradition.

    Acknowledging the problems of establishing causation within empirical studies of corruption, this essay will eschew the quantitative method and take an approach founded in Critical Theory by employing a genealogical dissection of neoliberalism to determine what light, on a conceptual level, can be shed on the understanding of corruption.

    Firstly, the history of classical liberal thought and the way it underpins its contemporary successor will be traced, its aims and fundamental principles isolated and the relationship between economic freedom, personal freedom and the state analysed. Concepts vital to liberal thought such as "natural freedom" and "contract theory" will be covered to lay bare the assumptions and presuppositions of liberal thought followed through thinkers such as Locke, Hobbes and Rousseau.

    Secondly, the moral status of wealth, freedom and corruption will be covered and the asymmetrical hierarchy that exists among these ideas especially in the influential shift from political freedom to economic freedom that is represented by Adam Smith. Mill's concept of utilitarianism will be juxtaposed against Smith's theories of marketization to show how neoliberalism, for better or worse, carries weight as an ethical theory. The links between Protestantism and liberalism will also be sketched to show that a distorting factor underpinning Western conceptions of freedom is the positive moral status accorded to wealth. Being run alongside all this is what relevance these insights have for the study of corruption within the neoliberal framework.

    To understand the fundamental concepts of liberalism, it is necessary to start with John Locke and the views posited in Two Treatises of Civil Government. Contributing to the argument concerning the state of mankind when stripped away of social and political institutions, Locke states that the natural condition, or "state of nature" of man is a:

    State of perfect freedom to order their actions, and dispose of their possessions and persons as they think fit, within the bounds of the law of Nature, without asking leave or depending upon the will of any other man. (Locke 1698)

    It is worth juxtaposing Locke with his intellectual predecessor and state-of-nature theorist, Thomas Hobbes, who held a famously dim view of mankind sans the state. A central internal tension within liberal thought can be traced to these two theorists. While Locke offers a benign view of freedom which, underpinned by obligation to God, places humanity within certain conditions by which property rights and cooperation are rational and objective, existing before and beyond any form of social contract. Hobbes, on the other hand states that mankind requires the social construction of covenant, contract and power to shield themselves from the inherent danger of the base ontological condition of liberty, stating: "Covenants, without the sword, are but words" (Hobbes 1996, p. 85). Anthony Kenny highlights the importance of the distinction, in the fact that under Locke's meaning of natural liberty, the sovereign is bound by a law which places a distinct limit on how much they can extract from their subjects against their will, while Hobbes does not define such a provision (Kenny 2007, p. 719).

    As such, the idea of human liberty is already problematized from its earliest proponents, with the development of two separate classes of liberty, one benign and the other not. When the state of government emerges to bind the common interests of man, the obligation one has to its institutions are different whether one subscribes to one view of liberty or the other. According to the Hobbesian view, the public sphere is an unnatural creation wherein individual freedoms are reduced for the sake of security and, as such, a contract exists between an individual and an institution, rather than merely between a community of individuals, as Locke would posit. When, as is in liberal thought, the separation between state and individual is quite fluid, the tension between the public/private can be better understood as the individual's obligation towards the "contract" that underpins the fundamental conceptual bind between self-interest and public interest.

    Another level of nuance is added to this tradition by Jean-Jacques Rousseau, who develops a synthesis between the Lockean and Hobbesian structures of state development. He refines Locke's notion of "natural liberty" into a concept of the "general will", which forms the mass of individuals into a "moral and collective body" where "each giving himself to all, gives himself to nobody" (Rousseau 1998, p. 15). This, like Hobbes, places emphasis on the "contract" as the guarantor and embodiment of human liberty. This has several implications, most importantly it implies that when a citizen acts against the state they are acting, in effect, against their own interests whether they realise it or not (Kenny 2007, p. 723). Whereas, to abuse the Hobbesian "contract" by acting against the public good is to essentially a restoration of natural freedom through the forfeit of what amounts to a pact of mutual security. However, within a Rousseauian system, to choose the private over the public is seen as irrational and generally a restriction of freedom and an act against the good, even despite Rousseau's much brighter conception of the state of nature (Rousseau 1998, p. 17).

    Generally, if a corrupt action, in relation to the state, is to be necessarily defined as "the abuse of public authority or trust for private benefit" (IMF 2012) then an analysis of the classical roots of liberal thought shows that the manner in which this public/private distinction is conceptualised is not static and straightforward, but rather subjective and historically contingent, especially when the question of liberty is brought to bear upon economics and ethics which the essay will turn to now.

    Buchan and Hill offer an illuminating account of the changing discourse of corruption as modern institutions of liberalism developed. They state that conventional, imperial notions of corruption, as defined by Montesquieu, focused on cycles of collective moral failure and degeneracy, connected to the greatness and decline of states; while a more advanced understanding concerns the aforementioned public/private overlap (Buchan & Hill 2007). They state that these "boundaries" of appropriate government developed alongside the growth of commerce. Likewise, Foucault, in his lectures collected in The Birth of Biopolitics sees this development of politics in the eighteenth century as the birth of "frugal government", wherein fundamental constitutional questions gave way to questions of practical government scope and intervention. He sees this as also linked to the development of "the market" as we understand it today, which simply did not exist in medieval society (Foucault 2008, p. 30). Thus, questions of individual liberty become associated with the issues of economic freedom, which remain insoluble components in neoliberalism.

    The thinker most notably associated with classical economic liberalism is, of course, Adam Smith. For the purposes of this critique, it suffices to say that Smith's vital contribution was the collation of Lockean property, labour and non-harm liberal principles into the mechanisms of transactions and the market. His understanding of the concept of natural liberty in relation to labour is described as:

    The private interests and passions of individuals naturally dispose them to turn their stock towards the employments which… are most advantageous and agreeable to the interest of the whole society. (Buchan & Hill 2007)

    This notion of "division of labour" plays into his idea that, at the most fundamental level of society and culture, freedom is most pointedly enacted through mechanisms of barter:

    Every man thus lives by exchanging, or becomes in some measure a merchant, and the society itself grows to be what is properly a commercial society. (Smith 1976, p. 37)

    This is important due to the fact that the breakdown of freedom to the level of freedom of market transaction is a primary axiom of neoliberalism. Through Smith, the discourse of liberalism shifts to cover the "problem space" between state and market rather than between state and individual (Peck 2008).

    This heralds a shift in the dynamics of understanding corruption on more of a market basis, wherein public corruption is seen as anything which restricts the operation of the free market and therefore infringes on the private rights of individuals. Monopolies and state control are seen as damaging and corrupt institutions; the elimination of such institutions is part of the road to establishing self-determining, autonomous individuals (Buchan & Hill 2007). In this light, payment of bribes to a state official, although it may constitute an "externality" (Crouch 2011), by the logic of the market may be seen as a logical and desirable outcome in order to promote the natural flow of commerce, bypass damaging monopolism and "restore the natural order". As such, man's economic freedom could come to be manifested in the right to pay a bribe, which would be seen as an enactment of his natural liberty in the face of the true corruption, which is the trans-market authority of the state.

    When thinking about corruption in this way, it is worth breaking down the ethical aspect of how the infringement of the private interest upon the public obligation is necessarily something which is morally wrong. As we have seen, within classical liberal thought the private/public distinction is not necessarily straightforward. Conventional liberal discourse on the proper ethical aims of government generally stems from the thought of another important liberal thinker: John Stuart Mill and his ideas on Utilitarianism. This "theory of utility", in the words of Mill, "holds that actions are right in proportion as they tend to promote happiness, wrong as they tend to produce the reverse of happiness" (Mill 1993, p. 7) and, as is evident in his Remarks on Bentham's Philosophy (p. 429) he considers it more than just Bentham's technical "phraseology", but a genuine ethical system of governance that can be integrated with humanity's natural freedom and the limits of the state that he deliberates on in On Liberty (Mill 1993, p. 69).

    It is clear that the majority of contemporary framing of the problem of corruption is done through a Utilitarian approach. The issues that are most notably brought up such as "misallocation of resources", "poor governance", "distortion of public policy" which ultimately tie in to questions of development, living standards and prosperity, implying that the outcome of fighting corruption would be more and better distributed wealth and, as such, the greatest amount of happiness for the greatest amount of people (IMF 2012) (TIA 2012).

    There are many valid criticisms of Utilitarianism, the one most relevant to this critique is the notion that Mill had not given sufficient thought to how distributive justice could be upheld (Kenny 2007, p. 928). In neoliberal literature, problems of distributive justice are negotiated through the Smithean idea that self-interest, driven by a desire for happiness, is best channelled through free market mechanisms to produce a system of wealth creation that will more organically satisfy the needs of the population. This policy direction in terms of corruption is elaborated as a set of axioms:

    H1: Market-oriented, neoliberal economic policies help reduce political corruption.

    H1a: Openness to foreign trade and investment promotes lower levels of political corruption.

    H1b: Lower and more market-friendly regulations inhibit political corruption.

    H1c: Smaller public sectors lead to less corruption than larger ones.

    (Gerring & Thacker 2005)

    Wealth (and the freedom to acquire wealth) is implicitly granted a moral status, since it is the vehicle by which the ethical ends of Utilitarianism are achieved. Thus, neoliberalism's approach to social justice is a cherry-picked assortment of classical liberal axioms: the marketized state of natural freedom wherein an ethical end is the unhindered flow of wealth which will permit the self-realization of needs. In effect, with this amalgam of Utilitarianism and Smithean economics, what is morally problematic about corruption is the fact that it does not permit the function of the economy as well as a perfectly free market would. Hypothetically, within this discourse of development and self-determining happiness, corrupt practice within state institutions would not be morally condemnable if it promoted greater flows of commerce and allowed people a greater chance of exercising their market freedom.

    What has been pursued in this essay is the history of classical liberal thought which remains as an undercurrent of modern neoliberal anticorruption policy. In closing, it is worth briefly covering some further contemporary criticisms of these assumptions. Bertrand Russell intimately connects the philosophy of Locke to the emancipation of free trade with the rise of Protestantism and Puritanism, which overturned the pre-existing Church "natural law" against usury (Russell 1945, p. 623). Max Weber develops an extensive sociological analysis of the linkage between these two concepts. The vital point of his work that bears relevance to this critique is that it views Puritanism and its derivative market values, not as a fundamental ontology or human nature, but a product of developing historical and social forces (Weber 2002).

    Russell speculates that fanciful notions of natural freedom and personal interest are a coupling of Protestant individualism alongside longstanding human traditions which recognise a historic Eden or "golden age" at the very beginnings of society. One of the great critics of this natural-state tradition is Karl Polanyi, whose work complements Weber's in providing an account of the rise of "economic man" that is outside the conventional Protestant paradigm and generally avoids making ontological presuppositions of freedom. In The Great Transformation he questions Smith's assumption that individual self-interest underlies all of society and thereby serves as a basis for understanding individual liberty:

    The outstanding discovery of recent historical and anthropological research is that man's economy, as a rule, is submerged in his social relationships. He does not act so as to safeguard his individual interest in the possession of material goods; he acts so as to safeguard his social standing, his social claims, his social assets. He values material goods only in so far as they serve this end. (Polanyi 1957)

    When one replaces the homo-economicus of neoliberalism with Polanyi's homo-juridicus, for whom freedom and exchange are a highly complex, inherent structure of social institutions, customs and laws; the sense in which economic corruption and social problems can be solved merely by expanding freedom to pursue interest (viz. the market) would appear to be misguided.

    Yet, by the trajectory of neoliberal ontology, Homo-economicus, becomes "not an ideal, but a reality; human nature" (Read 2009). Foucault emphasises this by posing it as a problem of power, stating that neoliberalism: "is not just a matter of governing states or economies, but is intimately tied to the government of the individual, to a particular manner of living" (Read 2009, p. 27). Critical analyses of neoliberalism also state that, while it is to some extent built upon the classical ideas of freedom and economics that this essay has covered, it has to some extent "rebuilt them from scratch" to accommodate its own agendas (Peck 2008). This notion that neoliberalism is somehow more malign than its classical counterpart is seen in the emphasis of the ethos of "zero-sum competition" which was alien to the "bond of union and friendship" which Smith suggested (Pettman 2010, p. 93). In this light, these notions of extreme liberalism (libertarianism) suggest that there is not only an unnatural disconnect between the individual and the state, but between individuals themselves. Foucault states that the homo-economicus of neoliberalism de-emphasizes the market of mutual exchange in favour of recreating the individual as the "entrepreneur of himself", wherein ones goal is to provide as much of an "investment" into ones "human capital" capacity as possible, which aims towards one single goal, the production of "self-satisfaction" (Foucault 2008, p. 226). As such, we can see how neoliberalism comes to bastardise conventional Utilitarianism to become isolated from the traditional liberal social and political "constraints" (Trigilia 2002, p. 19) in order to deal with purely an individualistic calculus of pleasure. In this respect, the concept of state corruption can be seen as one of two things, as an "investment" on the part of the consumer, no different to any other market element, or a "commodification" of public goods or services on behalf of the supplier, who is merely maximising his self-interest and endowment, in line with the dynamics of the self-centred market.

    As such, to conclude, this essay has attempted to, very briefly, trace a conceptual genealogy of classical liberal thought to displace the presuppositions and assumptions which underlie neoliberalism. This has been tied in to neoliberal approaches to corruption and the problems associated with an uncritical use of concepts like "freedom" and "the market" and the corruption of the terms of liberalism themselves in order to produce an understanding of the market as stripped of its traditional social, political and cultural connotation. To reiterate what was stated in the introduction, this essay has purposely avoided a quantitative empirical analysis, primarily because of the glut of empirical studies within corruption studies as well as the problems of establishing causation, especially within transitional economies. Critical Theory as well as Foucauldian discourse analysis continue to offer useful conceptual critiques that should not be discounted.

    Bibliography:

    Ali, AM & Isse, HS 2003, 'Determinants of Economic Corruption: A Cross-Country Comparison', Cato Journal, vol 22, no. 3, p. 449.

    Buchan, BA & Hill, L 2007, 'From Republicanism to Liberalism: Corruption and Empire in Enlightenment Political Thought', Australasian Political Studies Association Conference Proceedings.

    Crouch, C 2011, The Strange Non-Death of Neoliberalism, Polity Press, Cambridge, Malden.

    Foucault, M 2008, The Birth of Biopolitics: Lectures at the College de France, Palgrave Macmillan, Hampshire, New York.

    Gerring, J & Thacker, SC 2005, 'Do Neoliberal Policies Deter Political Corruption?', International Organization, vol 59, pp. 233-254.

    Hobbes, T 1996, Leviathan, Oxford University Press, Oxford.

    IMF 2012, The IMF and Good Governance, viewed October 2012, <http://www.imf.org/external/np/exr/facts/gov.htm>.

    Kenny, A 2007, A New History of Western Philosophy, Oxford University Press, Oxford.

    Locke, J 1698, Two Treatises on Government, viewed October 2012, <http://www.lonang.com/exlibris/locke/loc-202.htm>.

    Mill, JS 1993, Utilitarianism, On Liberty, Considerations on Representative Government, Everyman, London.

    Peck, J 2008, 'Remaking laissez-faire', Progress in Human Geography, vol 32, no. 1, pp. 3-43.

    Pettman, R 2010, World Affairs: An Analytical Overview, World Scientific Publishing, Singapore.

    Polanyi, K 1957, The Great Transformation, Beacon Press, Massachusetts.

    Read, J 2009, 'A Genealogy of Homo-Economicus: Neoliberalism and the Production of Subjectivity', Foucault Studies, vol 6, pp. 25-36.

    Rousseau, J-J 1998, The Social Contract, Wordsworth Classics of World Literature, Hertfordshire.

    Russell, B 1945, A History of Western Philosophy, Simon and Schuster, New York.

    Smith, A 1976, An Inquiry Into the Nature and Causes of the Wealth of Nations Vol. 1, Liberty Classics, Indianapolis.

    TIA 2012, Transparency International Australia: Mission Statement, viewed October 2012, <http://transparency.org.au/index.php/about-us/mission-statement/>.

    Trigilia, C 2002, Economic Sociology, Blackwell Publishers, Oxford.

    Weber, M 2002, The Protestant Ethic and the "Spirit" of Capitalism, Penguin Classics, London.

    Continued

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