The Anticorruption Imperative for Latin America

By Matthew Taylor*

Bar graph showing accountability in Latin America

Graphic courtesy of author. For a larger version, please click here.

Latin America’s reactions to the massive transnational scandals involving the Brazilian construction giant Odebrecht and its subsidiary Braskem are an important sign of progress in anticorruption efforts.  But across the region, courts’ reluctance to challenge elites remains a major obstacle to deeper accountability.  Brazilian, Swiss, and U.S. authorities’ announcement in December 2016 of a multibillion dollar global corruption settlement with the Brazilian firms – valued at $3.5 to 4.5 billion – was remarkable for being the largest in history.  It was also shocking for its revelations: Odebrecht admitted using a variety of elaborate subterfuges to launder bribe payments and corrupt proceeds, including by setting up a bribe department and buying an offshore bank.  Graft allowed executives to rewrite laws in their own favor, and guaranteed that the right officials were in the right place when public contracts were up for bidding.  The firms netted $3.60 for every $1 they spent on bribes in Brazil, and admitted to paying $788 million in bribes across twelve countries, including ten in Latin America.

The political salience of the charges is roughly similar in all ten Latin countries, muddying the reputations of presidents or former presidents in Argentina, Colombia, the Dominican Republic, Peru, Panama, Venezuela and, of course, Brazil.  Ministers and high-level officials have been implicated in the remaining countries: Ecuador, Guatemala, and Mexico.  Nearly one year after the settlement, it is time to ask how well law enforcement and judicial processes are resolving the allegations against these high-powered public and private sector elites.

  • In a paper forthcoming in Daedalus, I argue that accountability can be thought of as the outcome of a basic equation – A = (T + O + S) * (E – D) – combining transparency (T), defined in its most essential sense as public access to information about the government’s work; oversight (O), meaning that government functions are susceptible to surveillance that gives public or private agents the right to intensively evaluate the government’s performance; and sanction (S), effectively punishing wrongdoing and establishing societal norms to their rightful place. These are tempered by institutional effectiveness (E) – understood as the outcome of state capacity, relevant laws and procedures, and citizen engagement – and political dominance (D), which diminishes the incentives for active oversight or energetic sanction.  The graph above uses a combination of data points from the World Justice Project to measure each of the five variables.
  • The comparison yields mixed findings. On average, the nations implicated in the Odebrecht settlement do quite well on transparency, effectiveness, and political dominance – the outcome of a generation of democratic rule (with Venezuela being the obvious outlier).  But all ten countries perform comparatively poorly when it comes to oversight, and abysmally when the criterion is sanction.  This does not bode well for accountability, especially if we consider that among the Odebrecht Latin Ten, the highest-scoring country on the sanction criteria is Argentina, whose score is still below the middle-income country average.  In Brazil, where trial courts have led the way in imposing sanctions on business elites, political leaders are nonetheless protected against meaningful sanctions by an arcane system of privileged standing in the high courts.

Latin American judicial systems – long rigged to protect local economic and political elites – remain the principal obstacle to accountability.  The Odebrecht settlement signaled that a new day has arrived: new international norms and law enforcement across multiple jurisdictions are likely to continue to upset the cozy arrangements that have protected the region’s elites from corruption revelations for decades.  But true accountability will only come when local courts and prosecutors are empowered to effectively punish corrupt elites.  That implies changes in legal procedure, new laws, and most importantly, political will.  Perhaps the Odebrecht case will galvanize domestic public opinion and mobilize policymakers about the need to improve local justice systems.  The enormous costs of corruption revealed by the Odebrecht settlement suggest that change cannot come soon enough.

November 6, 2017

* Matthew Taylor is Associate Professor at the School of International Service at American University.  His forthcoming article in Daedalus is entitled “Getting to Accountability: A Framework for Planning and Implementing Anticorruption Strategies.”

Colombia: Historic Progress, Historic Challenges

By Fulton Armstrong

Colombia Peace

The leadership shown by Colombian President Santos and FARC Commander “Timochenko” – encouraged by the Vatican and the governments of Cuba, Norway, and the United States – will be tested as challenges to completion and implementation of a final accord are certain to be intense.  The President and FARC leader announced last week that they’d resolved the thorny issue of justice for guerrilla and government commanders accused of serious crimes and set a deadline of 23 March 2016 to sign a peace agreement.  The most important – and controversial – provision covers “transitional justice” for a range of offenses, including crimes against humanity.  Most of the estimated 6,000 rank-and-file FARC combatants will get amnesty, while commanders will choose between confessing their crimes and serving five- to eight-year terms performing labor in institutions other than prisons, or refusing to cooperate at the risk of much longer terms in prison.  (The same procedures will be established for government military officers accused of atrocities and those guilty of financing the paramilitary fighters who ravaged the countryside through the mid-2000s.)  The FARC also agreed that guerrillas would begin handing in their weapons when the final accord is signed.  Negotiators had previously agreed on rural development strategies, political participation, and counterdrug policies.

Almost universally, the agreement has been hailed as an historic achievement.  The announcement in Havana capped three years of talks facilitated by “guarantors” Cuba and Norway and later supported by the United States, represented by former Assistant Secretary of State Bernard Aronson.  During a mass in Cuba several days earlier, Pope Francis had implored the two sides to strike a deal, noting that “we do not have the right to allow ourselves yet another failure on this path of peace and reconciliation.”  U.S. Secretary of State Kerry called the Havana accord a “major breakthrough” and pledged that Aronson would stay closely engaged.

Latin American peace accords – most ending wars much shorter than the five decades of Colombia’s – provide ample evidence that the road ahead, however historic, will not be without difficult challenges.   

  • The accord will require a constitutional amendment, and President Santos will have to submit it for congressional approval and a national referendum. Former President Uribe, who leads Centro Democrático, has already declared war on it, calling it “a coup against democracy” that will lead to a “new dictatorship backed by guns and explosives.”  (Uribe also attacked Kerry’s statement as “deplorable.”)  Public discussion of details of guerrilla abuses, including forced youth recruitment and sexual violence, will play into opponents’ hand.
  • Colombian Prosecutor General Alejandro Ordóñez, an Uribe ally, said last week that any accord that does not entail prison terms for FARC commanders guilty of crimes would be “legally and politically untenable.” He claimed that it would violate victims’ rights and international law, which requires that punishment for war crimes be “proportional to the crimes committed.”  Human Rights Watch also condemned the provision and predicted the International Criminal Court would do so as well. 
  • Fulfilling commitments in the agreement to address the longstanding lack of government infrastructure in huge expanses of the country, help even modestly the resettlement of the more than 5 million persons displaced by violence, and expand programs to alleviate poverty and income inequality will have price tag beyond Colombia’s current ability to pay. Informal estimates of the 10-year cost are $30 billion.  The willingness of Colombian elites, who only grudgingly paid a war tax, to help foot the bill is far from certain.
  • The FARC’s ability to enforce discipline among its rank and file is also untested. There are reports that some commanders oppose any agreement.  Moreover, like demobilized paramilitary combatants, many combatants know no life other than rural combat and will be tempted to keep their weapons and join criminal networks that continue to terrorize rural communities.
  • The outstanding U.S. warrants for the extradition on drug-trafficking charges of reportedly dozens of FARC commanders may require some finessing, but Colombia’s peace commissioner, Sergio Jaramillo, suggested confidence that Washington will not demand extraditions if, as is almost certain, they would be a deal-breaker.

September 29, 2015

Civics Lessons from Guatemala

By Robert Brenneman*

Former Vice President of Guatemala Roxana Baldetti (l) and a protestor with sign "We demand justice" Photo Credits: Surizar / Flickr / Creative Commons

Former Vice President of Guatemala Roxana Baldetti (l) and a protestor holding sign that proclaims “We demand justice.” Photo Credits: Surizar / Flickr / Creative Commons

Guatemala’s popular movement for justice and transparency is suddenly and happily discovering that nothing breeds success like success.  Many Guatemalans have grumbled for years about rampant corruption among the political class, but in recent weeks a surging popular movement has finally emerged giving voice and energy to years of that frustration with impunity and graft.  The movement picked up steam after a public exposé of a shadowy tax fraud and contraband network called “La Línea,” orchestrated out of Vice President Roxana Baldetti’s office by her private secretary.  The report was produced by the International Commission against Impunity in Guatemala (CICIG).  (Click here for analysis of the Commission’s renewal.)  President Pérez Molina not only renewed CICIG’s term until 2017; on May 7 he also accepted the resignation of Baldetti and her secretary, who had served as the key money-raising dealmakers for his administration.  The U.S. Embassy suspended the visas of many of the officials named in the report, including the luckless former vice president herself.

These actions have not been enough to appease the appetite for justice and transparency sought by the growing crowds of flag-waving nonviolent protestors converging each Sunday afternoon in front of the Guatemala City’s Municipal Palace.  An estimated 57,000 gathered under thunder and pouring rain on May 17.  Empowered by the relatively swift impact of their movement, and outraged by the mounting evidence pointing to the president’s personal connections to the corruption network, the crowds of protestors  led principally by students of the public university  have shifted to demanding that the president himself step down.  Pérez Molina, sensing that the wheels are coming off his administration, has requested the resignations of his closest advisors and top officials, including his Interior Minister and his Chief of Strategic Intelligence.  He has revoked or rescinded several of the most lucrative (and obviously corrupt) government contracts that he had vociferously defended only a few weeks ago.

President Pérez Molina’s political future remains up in the air.  Many Guatemalan political analysts believe he should step down.  José Rubén Zamora, founder of Guatemala’s influential daily El Periódico, argues that resigning is “the only way out of an impossible labyrinth” of the president’s own making.  But many others view the president’s fate as less important than whether the country takes advantage of the opportunity to use public pressure to pass sorely needed structural reforms.  For years Congress has ignored several bills that would tighten campaign finance rules and bring transparency to government contracting.  Since pay-to-play politics is not unique to this administration, fixing the problem will require legal and structural changes, not merely changing the nameplate on the presidential suite.  One hopeful sign is that Manuel Baldizón, leader of the opposition Renewed Democratic Liberty Party (LIDER), has not managed to coopt the popular outrage to kickstart his own election campaign.  A popular banner at the protests warns him “¡No te toca!” (“It’s not your turn!”).  The leaders of the movement recognize that Baldizón – who has many skeletons in his own closet and heads another investment-financed party – is hardly the answer.  The protesters’ focus on reform rather than politics suggests that the most certain – and long-lasting – outcome of all is the strengthened civic sphere that appears to have emerged as the protests grow and the newspapers report daily arrests and resignations.  In this civics lesson, the Guatemalan public is both pupil and teacher.

May 26, 2015

*Dr. Brenneman teaches sociology at St. Michael’s College and is author of Homies and Hermanos: God and Gangs in Central America (Oxford University Press 2012).