The Economist - USA (2019-09-28)

32 The Americas The EconomistSeptember 28th 2019

2

Bello The battle without end

I

t goes onand on and on. In Mexico,

Rosario Robles, a former minister, was

jailed last month while under investiga-

tion regarding the siphoning off of some

$250m. Emilio Lozoya, the former boss

of Pemex, the state oil company, is on the

run in Europe from corruption charges.

In Peru, Susana Villarán, who was the

mayor of Lima, is accused of taking illicit

campaign money from Odebrecht, a

Brazilian construction firm. Her jail

mates include Keiko Fujimori, the leader

of the opposition, who faces a similar

accusation. All deny wrongdoing.

Corruption has rarely before been an

issue of such burning public concern in

Latin America. In a survey of more than

17,000 people in 18 of the region’s coun-

tries published this week by Transpa-

rency International (ti), a Berlin-based

watchdog, 85% said that government

corruption was “a big problem” in their

country, 53% think it is getting worse and

57% said it is not being tackled well.

Broadening the scope of the question to

include legislatures, police, judiciaries

and business as well as executives, more

Latin Americans see blanket corruption

than in ti’s equivalent poll in Africa.

That is surprising, because corrup-

tion tends to diminish as incomes rise

and Latin America is better off than

Africa. There are two caveats. Perception

is not always reality: free media in Latin

America have relentlessly publicised

corruption cases since Brazil’s sprawling

Lava Jato scandal, centred on Odebrecht,

broke in 2014. And some countries are

cleaner than others. Uruguay and Chile,

for example, are seen as less corrupt than

many European countries.

Elsewhere, though, corruption is

systemic and hydra-headed. It involves

not just stealing public money, but dis-

torting public spending and policy prior-

ities by taking illicit money from private

business. Once seen as necessary political

grease, it is now recognised as a millstone.

Estimates of its annual cost in Mexico vary

from 2% to 10% of gdp. In a pioneering

history of corruption in Peru, Alfonso

Quiroz reckoned that between 1820 and

2000 it snaffled up to 40% of government

spending and 3-4% of gdpgrowth per year.

Public anger has gone hand in hand

with an unprecedented offensive against

corruption in the region, which gathered

strength with Lava Jato. The crackdown

has been led by determined prosecutors

and judges. New legal tools have been

deployed, such as specialised anti-corrup-

tion investigators, plea-bargaining, pre-

ventive prison and international agree-

ments to share financial information. This

has delivered results. In Brazil, scores of

politicians and businessmen are in jail. In

Peru, four former presidents are under

investigation (one, Alan García, commit-

ted suicide in April). In Guatemala, a for-

mer president and his vice-president are

in prison.

But there have been excesses. Some

question whether preventive prison has

been abused. Peru’s constitutional tribu-

nal was this week hearing a plea to re-

lease Ms Fujimori, who has been in jail

for 11 months without charge. The cred-

ibility of Lava Jato has been undermined

by revelations, obtained by hacking, that

Sergio Moro, its main judge, worked in

unethical complicity with prosecutors.

Only in part because of such excesses,

the crackdown is at a turning point. A

backlash has begun. “The anti-corrup-

tion struggle...is a chessboard in which

the black pieces play too,” notes Delia

Ferreira, an Argentina lawyer who is

president of ti. Brazil’s supreme court

recently quashed one corruption convic-

tion because of a procedural mistake and

is reviewing others. Guatemala’s presi-

dent has thrown out a un-backed anti-

corruption commission (though El

Salvador’s new leader is setting up a

similar body). After a primary election

pointed to the return to power of Cristina

Fernández in Argentina, courts have

begun to stall graft cases against her.

But the mistakes suggest that the

campaign should be sharpened, not

abandoned. The impunity long enjoyed

by the powerful in Latin America has at

least been checked in some countries.

The task now is to widen and fine-tune

the use of the new legal tools, and to

complement them with other re-

forms—of campaign finance and the

judiciary itself. In the short term there is

a risk that public anger generates an

anti-political mood. That helped con-

trasting populists, Jair Bolsonaro and

Andrés Manuel López Obrador, to power

in Brazil and Mexico. But as Mr Quiroz

has pointed out, corruption is a cause as

well as a consequence of weak institu-

tions. Trying to slay it is a duty that can-

not be dodged.

The struggle against corruption reaches a turning point

(0.9% of Canada’s population) and the tar-

get for 2021 is 350,000.

Young voters, who also backed the Lib-

erals in 2015, may be harder to retain. The

environmentally minded were offended by

the government’s decision to buy an oil

pipeline whose backer was threatening to

pull out. But Mr Trudeau is trying to woo

them. On September 24th his party an-

nounced that it would commit to reaching

net zero carbon emissions by 2050.

On this issue, the dividing line is sharp.

The Conservatives, who have a strong base

in oil-rich Alberta, vow to repeal the na-

tional carbon tax of C$20 ($15) a tonne.

Peering through his affordability lens, Mr

Scheer says the tax raises the cost for ordin-

ary people of heating their homes and driv-

ing to work. The Conservative climate-

change plan, which includes investments

in green technology and tax credits for

homeowners who retrofit their homes, has

been criticised as expensive. For what it is

worth, such measures are less economical-

ly efficient than a carbon tax.

Mr Scheer has some weaknesses. He has

had to rebut Liberal suggestions that he

might try to restrict abortion and ban

same-sex marriage once in power. In On-

tario he is tainted by association with Doug

Ford, the unpopular Progressive Conserva-

tive premier who cut education and health-

care services after promising not to. And

the Conservatives must watch their right

flank, too. The People’s Party of Canada, a

new outfit, opposes Mr Trudeau’s “cult of

diversity” and wants to slash immigration.

Yet this election, like most, is a referen-

dum on the incumbent. And Mr Trudeau is

no longer the fresh-faced celebrity that he

was four years ago. Glum acceptance might

be the best he can hope for. 7