America's legalized corruption
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For example, influence peddling might help to explain why not a single U.S. government contract for Haiti's reconstruction in the last five months has gone to a Haitian company. In fact, out of $194 million awarded since the earthquake, just $4.8 million, or 2.5 percent of the total, has gone to Haitian companies. USAID has given out $33.5 million, none of which has gone to a Haitian company; some 92 percent of USAID's contracts have gone to Beltway (Washington DC, Maryland, and Virginia) contractors. Now isn't that a geographical oddity? About 15.5 percent of contracts in January 2010 were no-bid, which presumably could be justified because of the urgency; however this proportion has increased to 42.5 percent over the last five months.
Nassim Nicholas Taleb, author of The Black Swan, has pointed out how legalized corruption affects policy in the United States, and has compared it to bribery in African countries, often with delayed payments. Former Clinton Treasury Secretary and top economic advisor to Obama, Larry Summers, pulled down $5.2 million from a Wall Street hedge fund for part time work, along with hundreds of thousands of dollars from financial giants including Goldman Sachs. One has to wonder whether this influenced his decision-making in the Obama White House, which often seemed to go against his prior academic writings, his columns in the Financial Times, or even what he has said since he left office.
I think I'd rather have some of the poorer countries' corrupt practices that don't have so much influence on policy – like paying a bribe to get my passport renewed – than the ones that give us 25 million people unemployed, underemployed, or having dropped out of the labor force.
But unfortunately our corruption is an even bigger problem for the Haitians, who are desperately poor and can afford it much less. As a result of two centuries of foreign intervention that has caused more damage than the earthquake, including the overthrow of two democratically elected governments in the past two decades, Haiti has been reduced to dependency on foreign aid.
This week, 53 members of Congress, including Democratic leaders such as Eliot Engel and Steny Hoyer, sent a letter to the Obama Administration lamenting the "appalling conditions" that continue to prevail in tent camps and calling on organizations receiving U.S. funding to "demonstrate that they are making concrete progress in the camps." It's time for the "international community" to clean up its act.
This post was first published by The Guardian Unlimited (UK) on April 22.
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