Corruption in the Twenty-First Century

In 1626, Peter Minuit, the Director-General of the Dutch West India Company, purchased property from the Canarsee Indians for $2,400 worth of metal kettles, knives, axes, guns and blankets (Loewen, 1996). The town of Nieuw Amsterdam, later to be renamed, the borough of Manhattan in New York City (NYC) were established on this property . In 1653, the governmental structure in place in Nieuw Amsterdam hired a man name Tomas Bacxter (Bacxter), identified as a “retired pirate”, to build a wall at the northern end of the settlement. They paid Bacxter the equivalent of $1,300 in United States currency today (Hevesi, 1992). Within two years, the wall crumbled. It seems that Bacxter used inferior lumber in constructing the wall. In so doing, he misappropriated half of the funds allocated to purchase the material from suppliers. Subsequently, the good citizens of Nieuw Amsterdam seized on the opportunity created by the crumbling wall and took pieces of the wall to use in their homes and businesses to save on incurring the cost of purchasing or laboring on their own to obtain firewood. Today, the site where the wall was built is perhaps the world’s most well-known and prominent financial center: Wall Street (Hevesi, 1992). As I am editing this chapter, the “Occupy Wall Street”, protests are taking place not far from the location where Bacxter built the wall. The organizers of these protests have formed in the belief that corruption is alive and well in the form of the movers and shakers on Wall Street and that it needs to come to an end. If the belief of the protesters is true, the dread pirate Bacxter must be proudly smiling in his grave. The commissioning of Bacxter to construct the wall is among the first recorded stories of public corruption involving procurement fraud in the place where I have spent my career fighting corruption, New York City. It is possible that Bacxter was the first contractor to defraud the citizens of New York City. Regrettably, he was by no means the last. It is unfortunate, but the weaknesses in the procurement process that opened the door for Bacxter’s fraud are alive and well in the 21st century. I do not know the members of the selection committee, if such a committee existed, or the mind-set that was in place in 1653, that advocated it was a stroke of wisdom to hire a retired pirate to perform governmental work. The term “retired” does not translate into reformed or rehabilitated. In fact, if he were able to retire from being a pirate, it implies that he was successful at his chosen criminal career. There is no reason to believe that Bacxter’s retirement blessed him with a new found desire for honesty and integrity. Nor is it likely that his success as a pirate would have appeared on his resume during the due diligence process when proposing, that he possessed qualifications necessary to construct walls, and therefore, was qualified to be awarded the construction contract. I make these points only because what appears to have been the likely selection process in this procurement is not new to me. This was a clear example of the actions of short-term thinkers in a long-term world. More than three centuries have passed, and the type of dangerous thinking that existed then still exists today. I see the hiring of modern day pirates, with no intention of retiring, taking place today in the procurement process of many governments and organizations. Their existence continues to have far reaching negative impacts on societies worldwide. The spirit of Bacxter has produced a bumper crop of corrupt offspring. These spawns have taken up their father’s cause and continue to devour and devalue nations through their corrupt actions. Governments continue to engage modern day pirates; only today, these pirates are smart enough, or their lawyers are, to exploit all deficiencies and weaknesses of the system, and all the loopholes in the laws and language. This is a much more daunting scenario to combat for corruption fighters than just outright stealing; by trying to correct the deficiencies and fill in the loopholes, we often inadvertently create new ones. It has taught me to take nothing for granted and to never, ever, assume that common sense is alive and well in the process. Enough is enough There are numerous, colorful and entertaining stories of public corruption in NYC since the building of the wall. In spite of how entertaining these tales of misconduct may be; they fail to mask a grim reality. Public corruption is a global phenomenon that is far more threatening in the 21st century to the common good of any society than it was more than 350 years ago in Nieuw Amsterdam. This threat not only continues, but it has grown to sweeping proportions. Corruption has found a comfortable seat in almost all aspects of government. A large percentage of corruption occurring within governments worldwide rests within the procurement of goods and services. Every day, billions of dollars in procurement transactions take place worldwide. It is unfortunate, but not every dollar, yen, euro, peso or schilling ends up in the hands or accounts of the intended recipients. In a multitude of instances, these funds are redirected, embezzled, stolen or just wasted. Governments worldwide need to be honest and acknowledge that it is time to retreat from the daily impotent lip service they give to the topic of corruption and begin to take hold of this rabid tiger. Not by the tail, to then be dragged through the fields, but around the throat, choking off the air that gives life to the schemes that stifle the growth of a nation and its people. The unvarnished truth is that the primary function of government is to procure services for its people. Without the procurement process, there would be no means to secure the goods and services required to educate the people, defend the nation, and build roads, bridges and housing. Without procurement, there would be no hospitals, trains, planes and automobiles. Without procurement, government would cease to exist. It is a monumental undertaking that all governments take on in support of the people, as well as, the development and sustaining of a nation. Unfortunately, with that endeavor also comes an effort by those who would undermine good government by attempting to achieve a personal benefit by corrupting the established governmental processes, not solely by outside forces, but sadly, also from within. In order to prevent this unethical and illegal behavior, many governments have created, or are in the process of creating, offices whose primary function is to identify and eliminate corruption. Many of these offices are known as Inspectors General Offices or called by some name intended to convey the same message, which is, “enough is enough!”