History Professor Answers Corruption Questions

I'm historian Ruth Ben-Ghiat.

Let's answer your questions from the internet.

This is Tech Support Corruption.

[upbeat music]

AndyDoodle asks, How do third world rulers get so rich

if their countries are so broke-ass?

Well, often those countries are broke and get broker

because the dictator is stealing public funds.

A good case in point is Mobutu Sese Seko,

who was the leader of Congo for three decades.

He became immensely wealthy, amazing a fortune

of five billion in a country

where the average daily wage was $1.

How did he do this? He stole public funds.

He took tax money and directed it to his pet projects,

also to Swiss bank accounts.

He took kickbacks from foreign companies

doing business such as diamond extraction.

Mobutu was an important ally in the Cold War.

He was anti-communist.

So the International Monetary Fund

and the United States gave him lots of loans

that were supposed to be to improve the country.

Instead, that money went straight to his bank accounts.

@goddek asks, Alexa, define corruption.

Corruption is the abuse of power for private gain.

Now, corruption is also what we don't do

and that's called dereliction

of duty when we don't report abuses of power.

When we look the other way at the weaponization

of investigations against innocent people

or when we simply give up the idea

of ethics in the workplace and in life.

RockyWired asks, Be honest,

which country is the most corrupt in the world?

Transparency.org tracks corruption

and absence of transparency in countries around the world.

So they have a list.

And according to this list,

South Sudan is the most corrupt followed by Somalia,

Venezuela, Yemen, Libya, Eritrea, Sudan, Nicaragua,

Syria, and North Korea.

Some of these countries such as Venezuela are corrupt

because the government is in an alliance

with criminal gangs, which are used as enforcers

to beat up state enemies, also to get bribes from people.

And there becomes a gray zone between the state

and civilian criminal actors.

Other countries such as South Sudan

and Yemen are countries where authority has become

fragmented and there are warlords, each of them

with their own corruption networks.

Myanmar is also on the list

and that is a military junta

where the military has been allowed

to become active players in corruption schemes.

Military officials have amassed their own fortunes.

And this is how dictators keep people tied to the system.

Rocknocker61 asks, Why does it appear

that the number one job of all politicians

is to enrich their family?

Well, autocrats are family men in a way.

Since Mussolini in Italy, they surround themselves

with family members because family members can keep

their secrets and be easily controlled.

Mussolini appointed his son-in-law, Galeazzo Ciano,

as foreign minister, and Ciano

and his family had their own corruption network we now know.

Sons-in-law have an important place in the history

of autocratic corruption.

In Turkey, Erdogan's son-in-law runs the biggest

drone-producing company in Turkey,

which is drones used all over the world.

In the United States, Jared Kushner,

the president's son-in-law,

has been conducting private business on behalf

of his company, which is partly funded by the Saudis.

At the same time, he is representing the US government

in sensitive negotiations in Ukraine and Iran.

In healthy democracies, this would be called a conflict

of interest, but the Trump administration does not recognize

conflicts of interest.

This is the privatization of foreign policy

and it's something that's very common

in corrupt governments.

Dover299 asks, Where do politicians get so rich from?

Here we need to differentiate

between politicians growing rich

after they leave office when they're not bound anymore

by conflicts of interest.

Former heads of state,

and this is true all around the world, can become very rich

after they leave office from book deals, from speaking gigs,

all kinds of things, consulting, anything

that's gonna use their expertise as a former head of state.

Quite different are leaders

who amass wealth while they're still in office, ignoring

conflicts of interest.

And that's the case with Donald Trump,

who has amassed $5 billion in only 18 months in office.

There have been deals made that involve profits

for the companies owned by his family.

He also promotes personal products with his name on them,

which something that former US presidents have never done.

And over $640 million estimated has come in

from foreign investments to Trump and his family.

Rubyzhuman asks, WTF is a kleptocracy.

Literally, kleptocracy means rule by thieves.

Klepto being a thief.

Kleptocracy is a government where corruption

and thievery have become so institutionalized, so pervasive

that corruption is how you get things done.

It's a system where elites use their political positions

to amass private wealth,

where private businesses are plundered by the state

and have to pay bribes and kickbacks.

If they don't, they're subjected to legal harassment,

to tax audits, and sometimes even forced to sell at a loss.

And the beneficiary of all this is the state.

Ordinary citizens have to pay bribes

to get basic social services.

This was true often in the former communist countries,

certainly in Romania of Ceausescu,

who had his country living in poverty

while he lived in a grand palace.

Many countries that have a lot of oil

or energy deposits become kleptocracies.

And this is known as the resource curse.

The curse being that autocrats who have large supplies

of oil or natural gas tend to stay in power longer.

In Gaddafi's Libya, of course, the dictator was supreme,

but oil profits created centers

of extreme wealth around oil distribution and production.

Over time, these executives

and others in the state bureaucracy who had to do

with oil became immensely wealthy.

On the way, corruption becomes endemic.

It becomes pervasive.

In Gaddafi's Libya, which was a kleptocracy.

Everyone involved in the oil industry,

whether private or in the government amassed

private fortunes and were stealing these profits.

Instead of putting the oil profits for public good,

for roads, for public welfare,

most of them were siphoned off into Swiss bank accounts.

Now, sometimes if the dictator falls from power as happened

to Gaddafi, this can lead to an instability after

because these people can become almost like warlords.

And so you have a fragmentation

of power once the dictator leaves.

L. Rey asks, How do corrupt dictators hide their money?

Asking for a friend.

In the olden days, dictators used Swiss bank accounts

because until 2018, you could be anonymous

and there was no transparency regarding these bank accounts.

So you could stash your money

in these Swiss bank accounts and feel safe.

Nowadays, offshore finance is the game.

Because anonymity is guaranteed,

you can create a shell corporation

or have your money under someone else's name.

Very convenient for the bad actors in the world.

Until the 21st century, United Kingdom outposts such

as Gibraltar were big places

for dictators to put their money.

Augusto Pinochet, the former dictator of Chile,

had his money in United Kingdom banks offshore.

Nowadays, the United States has come to be one

of the main players in offshore finance.

States such as Nevada and Delaware

and South Dakota are places where many warlords,

arms dealers, dictators reportedly stash their funds.

Yet Another Ban 21 asks,

So what corruption is Benjamin Netanyahu

involved with again?

Netanyahu faces three separate cases

of bribery, fraud and breach of trust.

Regular politicians, if they're facing investigation

or have charges against them,

they don't wanna run for office.

Journalists could start poking around,

who knows what might come out.

If you are a wannabe autocrat, though, like Netanyahu,

you are compelled to run for office

because the point is to get into power

and fix the judiciary so your legal problems can go away.

A list of leaders who were under investigation

when they ran for office includes Vladimir Putin,

Silvio Berlusconi three times, Donald Trump three times,

and Netanyahu, who came into power

and immediately pursued something he called judicial reform,

which was supposed to fix the judicial system

to make his legal problems go away.

From the r/AskARussian subreddit,

Where did Putin get his wealth?

Russia's a kleptocracy

and President Vladimir Putin is rumored

to be among the richest men in the world.

How did he do it? On one hand, he plundered public agencies.

In particular, Gazprom, which is the oil

and natural gas conglomerate.

Basically, kleptocrats see public agencies as pots

of money that they can take for themselves.

So that's one way Putin did it,

by siphoning off profits from public agencies.

The second is by plundering private businesses.

A shocking one out of six Russian businesses

has been seized by the state or threatened by the state

or had a shakedown which requires them to pay bribes

or sell at a loss.

And so again, it's the private sector and the public sector.

When you put these together,

you create a formidable income stream for a dictator.

LegitimateSundae8460 asks,

Is Trump the most corrupt president? Without a doubt.

Donald Trump has made over $5 billion

just in the 18 months he has been in office.

Donors have been given contracts for businesses,

high political positions.

He promotes personal goods, profits

to which go toward the companies owned by his family

or companies owned by donors.

Trump has also pardoned financial criminals as well

as political criminals.

ThePOORmansTHINKINGMAN on Quora asks,

Why are the cronies of dictators always rich?

Here we have the concept of authoritarian bargains.

Dictators make bargains with elites.

Could be media elites, financial elites, business elites.

They make money in return for absolute loyalty.

There are no bid contracts.

Competition is gamed in their favor.

The state doesn't go after them.

Over time, this results in what's called a mafia state,

where clans associated by profit

to the dictator become immensely wealthy

and powerful in and of themselves.

In Putin's Russia, for example, there's the dictator,

Vladimir Putin, and there are the oligarchs

who become immensely wealthy

by sharing profits from illicit transactions.

And this is how the dictator keeps them tied to him.

It can be dangerous to speak out,

even if you're immensely wealthy against a dictator.

In Russia, you might fall out of a window.

Corruption isn't only about finances.

It's a way of keeping people in line.

The dictator knows your secrets.

In Russian, this is called Kompromat.

And the dictator, especially if he comes from

an intelligence background like Putin,

keeps information on those oligarchs

which he can use at any time.

And so this too is part of the authoritarian bargain.

It's not just profit, but it's keeping each other's secrets.

wya42wallabyway asks, Hmm, I wonder why corrupt leaders

always beef with the press.

If you wanna know if someone is trying to be an autocrat,

look at how they talk about the press.

Do they derive them as fake news?

Do they say they're corrupt, not to be trusted? Usually.

That's because autocratic leaders

or wannabe autocrats usually have secrets to hide

and they know the press could expose them.

Autocrats are afraid

of journalists uncovering their corruption.

And so autocrats try to silence,

especially investigative journalists.

That is a very dangerous profession.

damndirtyape asks, Why do some governments become corrupt?

Are there structural issues

that make some governments more prone to corruption?

There can be corruption in any kind of political system,

democracies, autocracies.

Corruption can happen anywhere in the world

where there's a leader and a political system

that promotes it because of the imperative

of self-preservation.

Autocrats are deathly afraid of being prosecuted.

This could be in Turkey

where Erdogan has repeatedly fired prosecutors

and judges and watchdogs.

The same thing happened in Hungary

where Orban stopped an EU investigation

against his son-in-law from taking place.

So it's not just in third world countries.

Corruption could be anywhere if the conditions are right.

PGadapaBooks asks, Can democracy survive corruption?

Corrupt systems create environments

in which things that used to be considered illegal

and immoral, such as lying about elections,

stealing from the public, sexual abuse,

they become normalized.

When that happens and institutions get retooled

to protect immoral people, then democracy suffers.

Now, sometimes sexual assaults can be a prompt

for a democracy to protect itself.

That happened in Italy when Berlusconi,

who had sex parties with young women,

was actually forced to step down.

He was investigated and convicted not only for bribery

and fraud, but for sex with a minor.

Around the world, foreign governments have been prosecuting

politicians who associated with Jeffrey Epstein

and appear in the Epstein files.

That has yet to happen in the United States.

Ze_Germans31B asks, Denying elections, hmm.

What has history taught us about this occurrence?

Many autocrats commit electoral fraud.

If the election doesn't go your way, you claim it was rigged

or you refuse to have the votes counted.

Or in the worst case, you refuse to leave office.

But election denial is something

that's often not considered in,

under the bucket of corruption.

But I believe it is because it is public officials

conspiring to lie to the public.

In Brazil, Jair Bolsonaro lost the 2022 election

and claimed it had been rigged.

Later, he tried to stage a coup

to prevent Lula da Silva from coming to power.

He now sits convicted with 27 years sentence.

Tygor asks, How does a country uncorrupt itself?

And what are some of the best examples

of this from recent times?

A country can uncorrupt itself by restoring regulations

that autocracies have removed.

They can restore professional ethics requirements

for civil servants, compliance for businesses

and corporations, and they can reign in the leader

who has to be held accountable.

We're seeing this in Hungary where Peter Magyar,

the successor of Viktor Orban, is restoring regulations

that Orban discarded in order to restore transparency

and accountability to Hungary.

So those are all the questions for today.

Thanks for watching. I