This year, we were fortunate to review close to 200 exceptional essay entries to our Annual Essay Competition 2024. The First Place winner is Devanshi Sinha from Chelmsford County High School:
“Corruption, embezzlement, fraud, these are all characteristics which exist everywhere. It is regrettably the way human nature functions, whether we like it or not.” (Allan Greenspan). Discuss.
Corruption is pandemic, transcending individual, economic, and geographical borders. Allan Greenspan argues that corruption is intrinsic to human nature, while others retort that neoliberal capitalism fosters corruptive environments. The proliferation of corruption depends upon governmental practices, underlining the complex relationship between democracy and corruption. Though corruption is universal, its manifestations differ internationally, often facilitated by “clean”
European countries. The rise of transnational corruption supports Greenspan’s view – modern corruption has globalised, causing negative economic multipliers worldwide. This essay classifies embezzlement and fraud as financial crimes under “corruption”, defined as “the abuse of entrusted power for private gain” (Transparency International 2024).
Seminal arguments surrounding intrinsic human corruption diverge between Thomas Hobbes and Jean-Jacques Rousseau (Yezzi 1986). Hobbes argues that unfettered corruption leads to a selfish state of war (1651), stemming from humanity’s prioritisation of short-term private gain over entrusted power (Blau 2009). Hobbes suggests that submission to a sovereign eliminates this inherent corruption (Lloyd and Sreedhar 2022). Rousseau counters Hobbes, contending that humanity, though innately self-preserving, is compassionate. Society is the greatest corrupter (Rousseau, 1762), particularly through private ownership and economic inequality (Tully and Scott 2020).
Similarly, Karl Marx locates corruption as a necessitated byproduct of industrial capitalism. This feasibly extends to neoliberal capitalism, where competition and deregulation prioritise profit over ethics. Under capitalism, Marx viewed money as the “bond of all bonds”, distorting human nature through mechanisation (1844). Corrupt financial crime (e.g., fraud and embezzlement) must therefore remain hidden because misappropriated funds become an “instrument of truth” (Mantzaris and Pillay 2013). In free markets where “naked self-interest” (Marx 1848) dominates, corruption is rationalised through the commodification of relationships.
John Girling (2015) expands on Marx, theorising that the inherent incompatibility between capitalism (profiting from private interest) and democracy (serving the public interest) breeds corruption. The expansion of public office introduces opportunities for corporate profit within political processes, causing corruption through the “re-confusion of private and public”. For example, the 2014 Brazilian “Operation Car Wash” scandal implicated almost a third of Brazil’s 494-member Congress in accepting illegal kickbacks from the state-run oil company Petrobras (Griggs 2019). This demonstrates Girling’s view that corruption arises when private profit overshadows national interests.
However, corruption is not uniformly distributed. Girling suggests that “normative strengths”, such as rule of law, democracy, and transparency, reduce corruption. While weak democracies typically experience higher corruption due to eroded institutional checks (Drapalova 2019), democratisation does not guarantee lower corruption (Papada et al. 2022). In fact, countries undergoing democratisation experience the highest levels of public corruption due to struggles to maintain accountability (McMann et al. 2020).
Corruption is lowest under full electoral democracy and highly authoritarian regimes, aligning with Hobbesian thought. Corruption peaks in transitional democracies (Fig 1). For example, the introduction of elections threatens unelected leaders with losing office, causing corruption in early elections (McMann) – the 2020 Myanmar general election, occurring during a transition from military rule to democracy, was riddled with voter exclusion and reserved seats (HRW 2020). Conversely, as electoral democracy improves, corruption decreases due to greater accountability costs. The 2018 Malaysian general election exemplifies this relationship; the electorate ousted ex-Prime Minister Najib Razak over corruption connected to the embezzlement of around US$700 million from Malaysia’s state-owned fund “1MDB” (Nair 2018). This demonstrates the crucial role of democracy in accommodating the “electoral impetus to punish”, provisionally expelling corruption (Pepinsky 2022).
Corruption also manifests differently between public and private sectors. The Corruption Perceptions Index (CPI) ranks countries by perceived public sector corruption, such as diversion of government funds, but crucially does not measure private sector corruption or money laundering (Transparency International 2024). Thus, “clean” EU nations, such as Denmark and Switzerland, while enjoying strong democracies and ranking first and joint-sixth in the 2023 CPI, are not immune to corruption. In fact, Operation Car Wash relied upon inadequately supervised EU banks to transfer illegal funds (Martini 2019). Furthermore, financial secrecy in European policy, such as the lack of publicly accessible “beneficial ownership” registries, encourages corruption (Transparency International 2024). This relationship between private corruption and governmental failure supports Greenspan’s view that corruption is systemically widespread.
The globalised influence of multinational corporations (MNCs) further normalises corruption. MNCs often calculate cost-benefits of corruption (Duley 2019), formalised through “Risk Appetite Statements” which analyse the level of reputational and legal “risk” an institution is willing to accept to maximise profits (EBRD 2024). In the 2022 Glencore scandal, the Swiss-based MNC paid over US$25 million in bribes to government officials across 5 African nations, 4 of which ranked within the 30 most corrupt countries on the CPI. Before their fining, Glencore had provisionally set aside US$1.5 billion to resolve potential punishments (Glencore 2022). Unsurprisingly, Glencore’s 2022 Risk Appetite Statement admitted higher legal risks in “developing” jurisdictions where corruption was the standard, illustrating Greenspan’s point that corruption is everywhere and even anticipated. MNCs often view corruption as “just another cost of doing business” (Beioley and Hook, 2022).
Globalised corruption spurs a negative economic cycle, hampering growth, worsening inequality, and deterring investment. Corruption is correlated with lower GDP (Chêne 2014) costing an estimated US$2.6 trillion annually, or 5% of global GDP (Guterres 2018). The International Monetary Fund found that corruption worsens poverty by increasing income inequality and permitting tax exemptions favouring the wealthy (Gupta et al. 1998). Public spending is also distorted, prioritising more profitable infrastructure or defence projects (Chêne). As poverty increases, demands for public spending increase – corruption, however, misallocates public funds, intensifying the cycle of negligence. Finally, foreign investor confidence erodes, as corruption becomes an “inefficient tax” on businesses (Chêne). These economic ramifications substantiate Greenspan’s belief that corruption is universal.
In conclusion, corruption has reached an alarming threshold, growing not by intrinsic human corruption but by profit-driven cultures and blurred lines between public and private interests. Though human fallibility contributes, strong rule of law and support for transitional democracies are critical in lowering corruption. These complexities link under Greenspan’s view that corruption is ubiquitous, normalised across professional sectors, continents, and economies. The need for reduced tolerance and greater transparency surrounding corruption is greater than ever.
Appendix
Figure 1: The curvilinear relationship between electoral democracy and corruption (McMann et al. 2020).
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