October 6, 2014

What is Corruption? An Economics-Influenced Take on the Price Hikes

By Aldric

Malaysia’s Federal Government announced that it is reducing the petrol subsidies. For consumers, this means we have to pay an extra RM0.20 for every litre of petrol. In reaction to the “petrol price hike”, many quarters are singing litanies of condemnation. Cries of corruption are heard. But what is “corruption”?

Corrupt, or corrumpere, meant “utterly broken”. It is no longer as whole as it once was. Politicians and philosophers Aristotle and Cicero then added “bribery and abandonment of good habits” to it. Today in the discussions of philosophy, theology and morality, corruption simply means “deviation from the ideal”.

Government, or political, corruption exists. And it happens when an officeholder or other government employee acts in an official capacity for personal gain.

But can any one segment of society monopolise corruption? Unfortunately, the answer is no.

Deviation from the Ideal

What is the ideals of a university student? For me it means mastery of the basic┬áthinking, researching and application skills of that field. The ideal of a law student, for instance, is “the ability to find the law, understand the law, and apply the law”. This is my favourite line from my then Constitutional Law professor, Prof Dr. Shad Saleem Faruqi.

Similarly the ideal parent would be one who cares and nurtures their children and those under their care. These are individuals who prepare the next generation for the challenges, realities and opportunities of life. It would include bringing the children to lessons and classes that would build their character. But above all, the flow of unconditional love to these gifts from God. A parent who neglects their children has become corrupted and tainted.

Next are when in line, an immigration officer favours one person over the rest. Despite coming later, the officer would give this person unwarranted or unjustified priority. How do I mean? The person who enjoys the favourable treatment may not have any disability, for example. Yet because of familiarity, she enjoys better and expedited treatment.

Or worse, when caught in a roadblock or hailed down by enforcement officers, the wrongdoer does not hesitate to offer some duit kopi to the officer.

So far these examples are “petty corruption”.

In their defense, especially the last one we should be mindful as the rakyat or people, we, too, enjoy special position. More so with the tool of social media. I have seen one such video where a driver harasses a traffic police for giving him a ticket. Hoping that the officer would chicken out and not discharge the duties and functions he swore to do, he is paid to do and is trusted to do.

Now when we allow the rakyat to bully civil servants or private sector workers, is that not corruption as well?

One of my friend was dissatisfied with the service at a fastfood outlet in a shopping mall in Kuching. He wrote on a Facebook group dedicated to food critics expressing his disappointment in the service rendered. Another user responded and started condemning the race of the fast food worker. Now I put to you: is condemning race an ideal a Malaysian and a Sarawakian society wants? For me it spells racism, bigotry and nothing short of moral corruption.

You know what’s the irony? This is from one who calls for change (ubah) in the political governance. As hygiene, charity and any values, it begins at home. In this instance, I am tempted to quote from Disney’s Hunchback of Notre Dame:

Judge Claude Frollo longed to purge the world of vice and sin
And he saw corruption everywhere except within

And this man is not alone. Over the years I have seen many forms of taintment, blemishes and blotches in character, in action, and in word from men and women who feels they are saints moving on clouds. Men and women who are quick to judge — and loves it.

From Petty to Systematic Corruption

My single worry is our obsession with labeling one another corrupt just because they do not see things the way we see things. It is the same was as some Muslim groups denouncing their own brethren as apostates because both sides cannot see eye to eye.

Yes when the price of fuel increases, there will be tremors felt throughout the market and the economic system. As if the price hike is not enough, we are entering into a GST/VAT era. Consumers have the right to be worried.

However I will not attribute this phenomena to corruption – systematic, grand or petty. Inflation is a part of life. As much as anti-capitalists would like to condemn the system, we live in a market driven reality.

Price will move according to our – the users’ – demand and the supply available. Please do not lament about the price of petrol in the early 90s. Why? I ask a question of logic: how many cars did we have back then? How many cars are there in a household these days?

Whether it is a Perodua MyVi, a Kia Sorento, a Honda Jazz, a Kancil or Kelissa, do they run on petrol?

When there are many cars on the road, what does this suggest? That Malaysians are becoming poorer? Is the income gap fairly represented here?

When we talk about market demand and the limited supply, it becomes easier to swallow the pain of inflation. Inflation is a reality, just as much as global warming and hazes are. An economy with Zero Inflation is at risk. It means that there is no growth. It is stagnant. But in terms of population and consumption, will we remain stagnant?

Even when we talk about mismanagement of our nation’s finances, I cannot accept the idea that the money saved by this exercise equals to what is “greedily consumed” by the powers that are.