Jeff's Heco

In Partial Fulfillment
of the requirements in
HECO101
Jefferson F. Alagon
BSN2-A
March 12, 2008

I. Introduction
This paper will present a condensed report on graft and corruption in the Philippines.
Information was compiled by the author from documents, internet articles and news paper
clippings.
We view corruption as an agent’s departure from the principal’s demand for the
responsible use of power in society. As such, although it is centered by a violation of law, it
does not involve the state alone. Rather, it is embroiled in the accountability of public officials,
and indeed of the state, to the people. Thus, in analyzing and combating corruption, we look
beyond the state. Corruption shows up what the society views as the responsible use of power
and thus what it will accept and support. In this light, any attack against corruption must come
to terms not only with the law, but also the country’s history, and what is accepted by the culture
and behavior of civil society as well.
All forms of government are susceptible to political corruption. Forms of corruption vary,
but include bribery, extortion, cronyism, nepotism, patronage, graft, and embezzlement. While
corruption may facilitate criminal enterprise such as drug trafficking, money laundering, and
trafficking, it is not restricted to these organized crime activities. In some nations corruption is
so common that it is expected when ordinary businesses or citizens interact with government
officials. The end-point of political corruption is a kleptocracy, literally "rule by thieves".
What constitutes illegal corruption differs depending on the country or jurisdiction.

Certain political funding practices that are legal in one place may be illegal in another. In some
countries, government officials have broad or not well defined powers, and the line between
what is legal and illegal can be difficult to draw.
Bribery around the world is estimated at about $1 trillion (£494bn) and the burden of
corruption falls disproportionately on the bottom billion people living in extreme poverty.
II. Graft and Corruption
In broad terms, according to wikipedia.com, political corruption is when government

officials use their governmental powers for illegitimate private gain. Misuse of government
power for other purposes, like repression of political opponents and general police brutality, is
not considered political corruption. Illegal acts by private persons or corporations not directly
involved with the government is not considered political corruption either. Illegal acts by
officeholders constitute political corruption only if the acts are directly related to their official
duties.
While bribery includes an intent to influence or be influenced by another for personal

gain, which is often difficult to prove, graft only requires that the official gains something of
value, not part of his official pay, when doing his work. Large "gifts" qualify as graft, and most
countries have laws against it. (For example, any gift over $200 value made to the President of
the United States is considered to be a gift to the Office of the Presidency and not to the
President himself. The outgoing President must buy it if he wants to take it with him.) Another
example of graft is a politician using his knowledge of zoning to purchase land which he knows
is planned for development, before this is publicly known, and then selling it at a significant
profit. This is comparable to insider trading in business.
If the highest echelons of the governments also take advantage from corruption or
embezzlement from the state's treasury, it is sometimes referred with the neologism
"Kleptocracy". Members of the government can take advantage of the natural resources (e.g.
diamonds and oil in a few prominent cases) or state-owned productive industries. A number of
corrupt governments have enriched themselves via foreign aid, which is often spent on showy
buildings and armaments.
corrupt dictatorship typically results in many years of general hardship and suffering for
the vast majority of citizens as civil society and the rule of law disintegrate. In addition, corrupt
dictators routinely ignore economic and social problems in their quest to amass ever more
wealth and power.
Measuring corruption - in the statistical sense - is naturally not a straight-forward matter, since
the participants are generally not forthcoming about it. Transparency International, a leading
anti-corruption NGO, provides three measures, updated annually: a Corruption Perceptions
Index (based on experts' opinions of how corrupt different countries are); a Global Corruption
Barometer (based on a survey of general public attitudes toward and experience of corruption);
and a Bribe Payers Survey, looking at the willingness of foreign firms to pay bribes. The World
Bank collects a range of data on corruption, including a set of Governance Indicators.
The ten countries perceived to be least corrupt, according to the 2007 Corruption Perceptions
Index, are Denmark, Finland, New Zealand, Singapore, Sweden, Iceland, The Netherlands,
Switzerland, Canada, and Norway.
According to the same survey, the nine countries perceived to be most corrupt are Somalia,
Myanmar, Iraq, Haiti, Uzbekistan, Tonga, Sudan, Chad, and Afghanistan.
In the USA, Louisiana, Mississippi, Kentucky, Alabama, and Ohio are the top five most corrupt
states, according to a 2007 study by Corporate Crime Reporter (based on U.S. Department of
Justice data on public convictions).
III. Summary and Conclusion
Corruption poses a serious development challenge. In the political realm, it undermines

democracy and good governance by flouting or even subverting formal processes. Corruption in
elections and in legislative bodies reduces accountability and distorts representation in
policymaking; corruption in the judiciary compromises the rule of law; and corruption in public
administration results in the unfair provision of services. More generally, corruption erodes the
institutional capacity of government as procedures are disregarded, resources are siphoned off,
and public offices are bought and sold. At the same time, corruption undermines the legitimacy
of government and such democratic values as trust and tolerance.
Corruption also undermines economic development by generating considerable

distortions and inefficiency. In the private sector, corruption increases the cost of business
through the price of illicit payments themselves, the management cost of negotiating with
officials, and the risk of breached agreements or detection. Although some claim corruption
reduces costs by cutting red tape, the availability of bribes can also induce officials to contrive
new rules and delays. Openly removing costly and lengthy regulations are better than covertly
allowing them to be bypassed by using bribes. Where corruption inflates the cost of business, it
also distorts the playing field, shielding firms with connections from competition and thereby
sustaining inefficient firms.
Corruption also generates economic distortions in the public sector by diverting public
investment into capital projects where bribes and kickbacks are more plentiful. Officials may
increase the technical complexity of public sector projects to conceal or pave way for such
dealings, thus further distorting investment. Corruption also lowers compliance with
construction, environmental, or other regulations, reduces the quality of government services
and infrastructure, and increases budgetary pressures on government.
Corruption facilitates environmental destruction. Although even the corrupt countries

may formally have legislation to protect the environment, it cannot be enforced if the officials
can be easily bribed. The same applies to social rights such as worker protection, prevention of
child labor and unionization. Violation of these laws and rights enables corrupt countries to gain
an illegitimate economic advantage in the international market.
We've touched on this topic many times in the past however, we find it hard to stay away
from it for long. According to many observers corruption is now an integral part of Philippine
society. But why it is, and how things deteriorated to this point is what many Filipinos both at
home and abroad are asking themselves.
Take the case of Major General Carlos Garcia, it seems inconceivable that he was able to
legally amass such personal wealth on his government salary alone. His position as comptroller
of the AFP (Armed Forces of the Philippines) however, gave him a sure-fire ticket to staggering
wealth and riches...well, for as long as corruption was allowed to seep into the various "nooks
and crannies" that surrounded the job.
And what about deposed President Estrada: where did he get the money to build all those
exotic mansions for his mistresses? In the Philippines, a government post is now seen as an easy
way to acquire great wealth, not as a way to serve the public.
All this of course bodes ill for our country. We Filipinos are harming ourselves in the
long run if we condone such practices. We cannot continue to look the other way. Why, because
if greasing palms is perceived as the only way to do business in the Philippines, most foreign
businesses will simply go elsewhere. And in today's highly interconnected world, the
Philippines has nothing extraordinary to offer that can force international firms to do business
there if they don't want to. Our current economic standing against most of our Southeast Asian
neighbors already provides ample proof that many businesses have skipped the Philippines
altogether and gone elsewhere.
As Filipinos, we can continue to stick our heads in the sand. We can give the General
Garcias and the President Estradas a slap on the wrist for all plundering they've done. As
individuals we can continue to slip a few pesos into the open desk drawers of corrupt civil
servants. We can refrain from rocking the boat as it heads towards the edge of a cliff. Or we can
take a stand and try to change things...
IV. Recommendations

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In Partial Fulfillment

March 12, 2008

What constitutes illegal corruption differs depending on the country or jurisdiction.

II. Graft and Corruption

In broad terms, according to wikipedia.com, political corruption is when government

While bribery includes an intent to influence or be influenced by another for personal

III. Summary and Conclusion

Corruption poses a serious development challenge. In the political realm, it undermines

Corruption also undermines economic development by generating considerable

Corruption facilitates environmental destruction. Although even the corrupt countries

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