Culture of corruption is a matter of style: If dishonesty can acquire legitimacy between the generations of a family, such a transformation can also take place within countries

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The Independent Online
LAST WEEK the Ross Perot of South Korea, Chung Ju-yung was eating humble pie, saying that he had not really meant any of the nasty things he had said about his presidential opponent Kim Young Sam, and that he had gone into the election only 'as a way of fighting a huge tax bill handed to his conglomerate, the Hyundai group' (New York Times, 4 March).

It was, if so, an expensive way of fighting a tax demand. Mr Chung was charged with diverting dollars 60m from Hyundai into his campaign, his son was arrested and so were 50 other Hyundai officials. One supposes that by the time the whole thing has been sorted out, enormous sums of money will have changed hands and there will still be the matter of that original tax bill.

It is another reminder that when the South Koreans think corrupt, they think big. So do the Japanese. Indeed, I used to have a theory that, within the culture of corruption, there was a North-East Asian and a South-East Asian style.

Both were on a grand scale. The difference was that the North-East Asian model was centripetal, creating large corporations and businesses and tending towards general economic success, while the South-East Asian model was centrifugal - money was squirrelled away into Swiss accounts, whisked off into American real estate or whatever else attracted the corrupt elite.

The South-East Asian model tended towards a general lack of success in the performance of the economy, the military or whatever the original funds had been designed for. If you were a general, you would sell arms to the enemy. South- East Asian corruption was stupid, the North-East model was clever.

The theory, however, has been geographically disproved by the success of the Thai economy and by the Indonesian example. The Indonesian regime is unpleasant, and I do not mean to say a word by way of exoneration when I say it comes under the functional, rather than dysfunctional, definition of corruption.

Nor do I intend to exonerate corruption itself by saying that corruption sometimes gets ahead. It is just that Corruption Theory must begin somewhere, and the distinction between functional and dysfunctional is particularly vivid if you are living in a corrupt country. There is all the difference between living as a humble worker in South Korea and living under, say, an African dictator with a passion for collecting French chateaux: someone bleeding his country to death.

Corruption Theory emphasises the historical dimension of its subject - is this corruption on the way up or down? Things may change between generations, within a single family. So the grandfather, the founder of the political party, is a gangster, the son is a politician corrupt within a historically determined level of tolerance, and his son is, or should be, powerful through wealth and connections. He has legitimised the process.

This is an American paradigm - can you succesfully escape the gangster phase into the desirable legitimacy, or is your 'family' recidivist? This is the story of films and soap operas, but it is a story taken from real life. Are you a Kennedy or are you a Gambino?

If corruption may change between generations of a family, one supposes that a country or regime may undergo the same transformation. Both Italy and Japan have suffered from strong links between politicians and organised crime. Perhaps that era is coming to an end. Perhaps something similar is happening in South Korea, with its slow but apparently sustained transition from military regime (Chun Doo-Hwan) to civilian- former military (Roh Tae Woo) to former-dissident-now-ruling-party, anti- corruption (Kim Young Sam, the new president).

If this were the general understanding of those involved, one would expect that this week's public disavowal and cringing behaviour will help get Mr Chung, his Hyundai corporation, his son and his 50 employees off the hook eventually, as it would be seen that the continuing successful performance of Hyundai would be a Good Thing for South Korea.

Changes of regime or administration are traditional opportunities for clearing up a part of the existing corruption and perhaps offering an amnesty for the rest. Without such periodic upheavals there is no 'statute of limitations' on corruption - a fact that plays into the hands of a certain kind of dictator.

For corruption has this major disadvantage: it leaves you at the mercy of others. If Fidel Castro wishes to forestall internal opposition, an anti-corruption drive (where corruption is a capital offence) may be convenient. But it is not as clever as the South Korean approach. Cuba is not clever, in this sense.

Corruption is about success. In areas where success is being artificially held back for some reason, as in China, it is likely that the most successful areas are the most corrupt - that is, the New Economic Zones near Hong Kong and other coastal areas. In Russia, we have been shown a series of profiles of the newly successful business types with 'glamorous' lifestyles. I do not mind these articles if they are understood to be profiles in gangsterism, but if they come across as studies in Thatcherite savvy then I tend to skip.

Corruption is about scale. If I can achieve the situation where the collapse of my enterprise/corporation/bank would threaten the economy itself (as opposed merely to me and my investors) then, however wicked I have been, mysterious unseen hands will be stretched out to prevent my fall.

Corruption is about theft, of course. The money always comes from somewhere, and this is one way in which the Godfather films are sentimental, to the extent that they go along with the notion that the various godfathers do indeed provide a sort of service in return for the fee exacted. They may have provided such a service, but if the fee was compulsory and exacted without regard for demand for the service - or, in the purest form of protection money, the fee protected you simply from the consequences of not paying the fee - then theft is a better description than any euphemism.

One way of reducing poverty in what used to be called the Third World, one of the best and most sophisticated ways, would be to improve banking facilities for the poor. Corrupt banks, or wildly expensive and inefficient banking facilities, are an utter menace since they leave the poor with no recourse but to usurers. (The other great way of reducing poverty is, of course, to improve rural medicine. Where both banks and hospitals are corrupt, you have the most miserable results of all.)

Corruption Theory, if developed as a discipline, could usefully be put to work devising better banks for poor countries. And, as a modest by-product (the non- stick pan in comparison with that space rocket), what about better banks for rich countries as well?