Students learn the perils of cheating by playing a game where they all are international traders. Each student receives an envelope containing a blue card worth $20 million in merchandise and a green one worth $10 million.Both dealmakers assume they can make a great profit by reselling whatever merchandise they receive in the trade. One or more sets of two students go out in the hall to negotiate a deal (or the whole class can discuss what kind of deal to make). They shake hands on the deal and turn their backs on each other while inserting the card or cards in the envelope they'll give to their customer. If, for example, they agree to trade both cards, but one student gives the customer only one card, what will happen, if these two try to make a deal in the future?
Opportunities to cheat tempt young people inside and outside their families and school. If something breaks, one sibling blames another. Students cheat on tests, copy reports from material on the internet, steal clothes from retailers, get "free" food from friends who work at fast food restaurants. Young people lie about staying over at a friend's house, when they plan to do something else. They drive too fast, fail to wear seat belts, and text while driving. They drink alcohol, experiment with drugs, and cheat on their boy/girl friends by dating others.
Ask students if they would be willing to loan $155 million to a company mired in corruption. This is currently a real life case that provides a cautionary tale to students who would carry their cheating habits over into their careers.
Related to a corruption enforcement decision, Odebrecht, an engineering company in Brazil, now owes a $2.7 billion fine to Brazil, Switzerland, and the United States for an extensive bribery scheme that stretched from South America to Central America to North America. On Wednesday, April 25, 2018, the company's construction unit needs loans to repay a $144 million bond within a 30-day grace period. By the end of the month, the company also owes an $11 million interest payment.
A default on these payments could lead banks holding other Odebrecht loans to demand earlier payment, because they see bankruptcy looming. Odebrecht finds buyers for assets it is trying to sell know the company is desperate to free up cash and offer to pay lower prices over extended periods. Not knowing what future assets the company will have for collateral does not reassure potential new lenders. As it is, banks asked for new loans offer less than needed, and Brazil's government development bank is reluctant to guarantee these private loans. In few countries will government officials want anything to do with accepting a bid and letting a contract for a new Odebrecht project that could hint of a kickback or any sort of bribery.
Corruption gives foreign investors an opportunity to gain control of key sectors in a country, when cash-strapped companies convicted of wrongdoing cannot find funds elsewhere. Corrupt Brazilian companies offer this kind of risk to their country. Already, the jointly owned China Three Gorges (CTG) and Portugal's largest company, the EDP utility, run hydroelectric power plants in Brazil. CTG holds a 23% share in EDP and aims for total control. Both companies have assets in other countries besides China and Portugal. EDP, for example, operates in 14 countries, including the United States, Spain, France, Italy, and Poland, where China is perceived as an intelligence and corporate espionage threat.
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News that former Brazilian president, Luiz Inacio Lula da Silva, has been jailed on corruption charges for allegedly accepting bribes from Odebrecht has been noted in Angola, one of Brazil's other former territories, as a cautionary tale.
For an excellent overview of international efforts to eliminate corruption, consult Corruption and Misuse of Public Office, published in the UK by Oxford University Press. Cheating of any sort is risky business. There is no guarantee that governments, teachers, parents, and girlfriends/boyfriends will not find out. Trust is a terrible thing to lose.
Showing posts with label bribes. Show all posts
Showing posts with label bribes. Show all posts
Friday, April 27, 2018
Friday, August 26, 2016
Impact of Corruption on Terrorism
In some respects, you can't blame government leaders for adopting the self-serving, often corrupt, methods of the colonial administrators they followed after their countries became independent. Nonetheless, as U.S. Secretary of State John Kerry pointed out in remarks in Sokoto, Nigeria (8/23/2016), bribery, fraud, inequality, humiliation, and poverty play into the hands of terrorist extremists.
In terms of government interference and corruption, when the World Bank's "Doing Business Index" and the "Corruption Perceptions Index" rank Nigeria as a worse offender than 89% and 82% of the other countries in the world, Nigeria gives a terrorist group like Boko Haram a recruiting argument and an excuse to engage in its own looting, killing, and kidnapping.
Citizens need to feel people in power work for them. Government funds need to be used to provide health care, educate their children, build roads, provide clean water and electricity, support agriculture, and attract investment and business, not head overseas to the secret bank accounts of crooked politicians.
(Also see the earlier posts, "Corruption Has Consequences," "Cheating is Easy, but...," and "Warning to Students: Don't Cheat.")
In terms of government interference and corruption, when the World Bank's "Doing Business Index" and the "Corruption Perceptions Index" rank Nigeria as a worse offender than 89% and 82% of the other countries in the world, Nigeria gives a terrorist group like Boko Haram a recruiting argument and an excuse to engage in its own looting, killing, and kidnapping.
Citizens need to feel people in power work for them. Government funds need to be used to provide health care, educate their children, build roads, provide clean water and electricity, support agriculture, and attract investment and business, not head overseas to the secret bank accounts of crooked politicians.
(Also see the earlier posts, "Corruption Has Consequences," "Cheating is Easy, but...," and "Warning to Students: Don't Cheat.")
Tuesday, March 1, 2016
Corruption Has Consequences
Countries with a reputation for being free of corruption from abuse of power, bribes and kickbacks, and secret deals are attractive tourist destinations and prospects for business investment. Unfortunately, based on a study of 168 countries by the OECD (Organization for Economic Co-operation and Development), no country is totally free of corruption.
In 2015, using a scale of 0-100, the OECD's corruption index showed 68% of the ranked countries scored below 50, indicating a serious corruption problem that took protesters to the streets in some countries. Even Denmark, which scored 91, has room for a bit of improvement. The United States and Austria, with scores of 76, did not make the top ten list of least corrupt countries, which included: Finland, Sweden, New Zealand, the Netherlands, Norway, Switzerland, Singapore, Canada, and Germany. Corruption caused Kim Jong-un's North Korea and Somalia to tie for last place in both 2014 and 2015.
Brazil, now embroiled in a corruption scandal (See the earlier post, "Warning to Students: Don't Cheat."), dropped 5 points since 2014, and was in 76th place in 2015. Not a good prospect for countries sending teams to this summer's Olympics in Rio.
The OEDC cautions that its corruption index is based on surveys of conditions institutions make within a country's borders. Countries might have a higher or lower score, if their corruption activities in foreign countries were measured. Indeed, half of OECD countries have been found to violate agreements to stop companies from paying bribes when they do business in countries outside their borders.
The earlier post, "Cheating is Easy, but...," provides some anti-corruption strategies for doing business around the world.
In 2015, using a scale of 0-100, the OECD's corruption index showed 68% of the ranked countries scored below 50, indicating a serious corruption problem that took protesters to the streets in some countries. Even Denmark, which scored 91, has room for a bit of improvement. The United States and Austria, with scores of 76, did not make the top ten list of least corrupt countries, which included: Finland, Sweden, New Zealand, the Netherlands, Norway, Switzerland, Singapore, Canada, and Germany. Corruption caused Kim Jong-un's North Korea and Somalia to tie for last place in both 2014 and 2015.
Brazil, now embroiled in a corruption scandal (See the earlier post, "Warning to Students: Don't Cheat."), dropped 5 points since 2014, and was in 76th place in 2015. Not a good prospect for countries sending teams to this summer's Olympics in Rio.
The OEDC cautions that its corruption index is based on surveys of conditions institutions make within a country's borders. Countries might have a higher or lower score, if their corruption activities in foreign countries were measured. Indeed, half of OECD countries have been found to violate agreements to stop companies from paying bribes when they do business in countries outside their borders.
The earlier post, "Cheating is Easy, but...," provides some anti-corruption strategies for doing business around the world.
Sunday, November 29, 2015
Cheating is Easy, but...
When my daughter was using a game to teach a concept, the student who won suddenly jumped up and said, "Yes!" Whether a student is learning a new concept in a dirt floor classroom in Sudan, in an air conditioned one in Saudi Arabia, or in a slum in Chicago, the joy of understanding can't be underestimated. As Pope Frances observed last week during his trip to Nairobi, Africa, a country riddled with bribery and government graft, corruption is easy, but it robs a person of peace and joy. Conversely, mastering a concept gives joy.
I have been very interested to read in Elmira Bayrasli's book, From the Other Side of the World,
how entrepreneurs in unlikely places are countering what India calls chai paani, "a little bit of extra," the tradition of taking a bribe before correcting an erroneous and costly customs classification, performing a medical test, issuing a telephone number, or awarding a construction contract.
When I taught international marketing, I used to dread teaching the chapter that discussed the Foreign Corrupt Practices Act, which prohibits US businesses from paying bribes openly or using middlemen as conduits for a bribe, when the middleman is known to use part of the payment for a bribe. I felt naive teaching that US corporations would resist the temptation to maneuver around the law when multi-million dollar contracts were at stake. I remembered the story of the overseas diplomat who took a visitor from the US to see two new office towers. "There were supposed to be three," he said, "but, after paying kickbacks, there was only money left for two."
With this background in mind, I was surprised and delighted to read how the ability to obtain licenses, register property, and obtain other government services online has eliminated contact with officials who have discretionary power to do their jobs only after they collect a bribe, the little bit of extra.
Although there are still many instances where bribes and kickbacks could help a business handle government paperback faster, companies like the "Dial 1298" private ambulance firm in India and high tech Infosys and Wipro in Pakistan refuse to engage in corruption. They decided to create a new corporate culture built on well defined and uncompromising values and standards that employees are expected to internalize. Moreover, organizations like Transparency International and Ipaidabribe.com, have sprung up to monitor corruption and to invite reports of bribes required and paid in India, Pakistan, Kenya, and Russia. Narenda Modi, India's current prime minister, considered it a winning message to campaign on a promise to end corruption.
Bayrasli observed that the middle class expects functioning public services and reliable governance. As globalization expands the middle class throughout the world, wise parents and teachers may need not only to punish cheating but to reward the value and joy of learning.
(Also see the earlier posts, "Warning to Students: Don't Cheat" and "Learning Can Be Fun.")
I have been very interested to read in Elmira Bayrasli's book, From the Other Side of the World,
how entrepreneurs in unlikely places are countering what India calls chai paani, "a little bit of extra," the tradition of taking a bribe before correcting an erroneous and costly customs classification, performing a medical test, issuing a telephone number, or awarding a construction contract.
When I taught international marketing, I used to dread teaching the chapter that discussed the Foreign Corrupt Practices Act, which prohibits US businesses from paying bribes openly or using middlemen as conduits for a bribe, when the middleman is known to use part of the payment for a bribe. I felt naive teaching that US corporations would resist the temptation to maneuver around the law when multi-million dollar contracts were at stake. I remembered the story of the overseas diplomat who took a visitor from the US to see two new office towers. "There were supposed to be three," he said, "but, after paying kickbacks, there was only money left for two."
With this background in mind, I was surprised and delighted to read how the ability to obtain licenses, register property, and obtain other government services online has eliminated contact with officials who have discretionary power to do their jobs only after they collect a bribe, the little bit of extra.
Although there are still many instances where bribes and kickbacks could help a business handle government paperback faster, companies like the "Dial 1298" private ambulance firm in India and high tech Infosys and Wipro in Pakistan refuse to engage in corruption. They decided to create a new corporate culture built on well defined and uncompromising values and standards that employees are expected to internalize. Moreover, organizations like Transparency International and Ipaidabribe.com, have sprung up to monitor corruption and to invite reports of bribes required and paid in India, Pakistan, Kenya, and Russia. Narenda Modi, India's current prime minister, considered it a winning message to campaign on a promise to end corruption.
Bayrasli observed that the middle class expects functioning public services and reliable governance. As globalization expands the middle class throughout the world, wise parents and teachers may need not only to punish cheating but to reward the value and joy of learning.
(Also see the earlier posts, "Warning to Students: Don't Cheat" and "Learning Can Be Fun.")
Monday, August 24, 2015
Warning to Students: Don't Cheat
Children who are motivated to cheat by copying another student's work, paying someone to write their papers, or hiring another student to take a standardized test for them could learn a few lessons from those who have avoided corruption or engaged in it around the world.
Even if the current business culture in a country sanctions corruption, the honesty espoused by Bulent Celebi's AirTies firm in Turkey offers a promising example. When Celebi established his WiFi company, which does not rely on phone lines or fiber optic cables to transmit data, he had six founding values. Besides customer satisfaction and engaged employees, he stated AirTies would be ethical. Therefore, he did not rely on bribes but, according to Elmira Bayrasli's book, From the Other Side of the World, he launched his business by working through the laborious process of dealing with Turkey's bureaucracy and paperwork. Shortcuts, he felt, would start AirTies off in the wrong direction.
While on a visit to Nairobi, Kenya, in November, 2015, Pope Francis told a cheering crowd that corruption was easy and sweet but in the end it makes politics, even in the Vatican, and a country sick. He urged the crowd to keep corruption out of its lives, because corruption takes away joy and robs people of peace in their lives.
Major European auto and truck maker, VW, will pay at least $15 billion for developing a cheating way to pass emissions tests.
As a result of bribing doctors and hospitals by giving them kickbacks, the Japanese-based manufacturer, Olympus, paid a $646 million fine.
By pretending subprime mortgages were sound, Goldman Sachs, one of the US firms that helped bring on the 2008 recession, is expected to pay about $5 billion to resolve state and federal investigations.
In Brazil, President Dilma Rousseff and House Speaker Eduardo Cunha have been implicated in a corruption scandal involving construction firms that paid bribes to Petrobras, the state energy firm. Marcelo Odebrecht, former head of Brazil's giant construction company, designed the scheme that paid kickbacks to win contracts from senior Petrobras officials and that funded political campaigns. In March, 2016, Odebrecht was sentenced to 19 years in prison. Although Rousseff thus far has been found blameless in the Petrobras scandal, the charge of her involvement has led to a call for her impeachment and hurt the country's economy by stopping building and energy projects. Petrobras has had to stop paying dividends, and the company has cut $32 billion from its 5-year $130 billion investment plan. Now that the Federal Accounts Court has ruled that Rousseff's administration used illegal accounting practices, the prospect of impeachment is even greater. Eventually, Rousseff was out, but in June, 2017, new President Michel Temer was charged with taking $11.5 million in bribes for helping a meatpacker who had tax and loan problems.
Sigmundur David Gunnlaugsson, Iceland's Prime Minister, was the first victim of a leak of papers from the Panamanian law firm, Mossack Fonseca. In April, 2016, he stepped down, when it was disclosed that he and his wife owned an undeclared off shore account where he concealed millions of dollars from taxes. The papers reveal Mossack Fonseca also has formed off shore shell companies to help other clients launder money, dodge sanctions, and evade taxes.
Nigerian authorities fined the South African-based MTN multinational mobile telecommunications company $5.2 billion, later reduced to $3.4 billion. Of MTN's 62 million subscribers, the company failed to disconnect 5.1 million unregistered, and therefore unidentified, Sim card accounts. Kidnappers had used an unregistered Sim card from MTN to demand a ransom for Nigeria's former finance minister, Chief Olu Falae.
A November, 2015 report from the World Anti Doping Agency alleging State-sponsored doping of Russia's Olympic athletes could result in banning the country from competing in 2016's Summer Olympics. And the head of the agency that selects the countries that hold World Cup soccer matches had to resign, when winning host countries were found to have bribed their way into the honor.
In Indonesia, the government's failure to keep an up-to-date land registry results in an inability to assign blame for the devastating forest fires on the islands of Sumatra and Borneo that also have spread a thick haze of smoke to Malaysia, Singapore, and southern Thailand. All together, the smoke has caused an estimated 500,000 respiratory tract infections, and 100,000 premature deaths are a possibility. Fires are set by cheap slash and burn methods used to clear for new planting by both small scale farmers and corporate palm oil, timber (used for paper), and other agricultural corporations. Standards for the hiring and working conditions of migrant labor in the palm oil industry have failed to remedy abuses. When an investigation by the Roundtable on Sustainable Palm Oil found the Malaysian palm oil company, IOI, failed to correct deforestation violations in its concessions, Unilever and 9 other major companies cancelled their contracts with IOI.
You can read about charges of corruption Russia faces in the earlier blog post, "Hearing Voices." And Communist Party officials throughout China have been severely punished as reported in the earlier blog post, "China's Corruption Crackdown, New Bank Backing, and Release of PR Activists."
Even if the current business culture in a country sanctions corruption, the honesty espoused by Bulent Celebi's AirTies firm in Turkey offers a promising example. When Celebi established his WiFi company, which does not rely on phone lines or fiber optic cables to transmit data, he had six founding values. Besides customer satisfaction and engaged employees, he stated AirTies would be ethical. Therefore, he did not rely on bribes but, according to Elmira Bayrasli's book, From the Other Side of the World, he launched his business by working through the laborious process of dealing with Turkey's bureaucracy and paperwork. Shortcuts, he felt, would start AirTies off in the wrong direction.
While on a visit to Nairobi, Kenya, in November, 2015, Pope Francis told a cheering crowd that corruption was easy and sweet but in the end it makes politics, even in the Vatican, and a country sick. He urged the crowd to keep corruption out of its lives, because corruption takes away joy and robs people of peace in their lives.
Major European auto and truck maker, VW, will pay at least $15 billion for developing a cheating way to pass emissions tests.
As a result of bribing doctors and hospitals by giving them kickbacks, the Japanese-based manufacturer, Olympus, paid a $646 million fine.
By pretending subprime mortgages were sound, Goldman Sachs, one of the US firms that helped bring on the 2008 recession, is expected to pay about $5 billion to resolve state and federal investigations.
In Brazil, President Dilma Rousseff and House Speaker Eduardo Cunha have been implicated in a corruption scandal involving construction firms that paid bribes to Petrobras, the state energy firm. Marcelo Odebrecht, former head of Brazil's giant construction company, designed the scheme that paid kickbacks to win contracts from senior Petrobras officials and that funded political campaigns. In March, 2016, Odebrecht was sentenced to 19 years in prison. Although Rousseff thus far has been found blameless in the Petrobras scandal, the charge of her involvement has led to a call for her impeachment and hurt the country's economy by stopping building and energy projects. Petrobras has had to stop paying dividends, and the company has cut $32 billion from its 5-year $130 billion investment plan. Now that the Federal Accounts Court has ruled that Rousseff's administration used illegal accounting practices, the prospect of impeachment is even greater. Eventually, Rousseff was out, but in June, 2017, new President Michel Temer was charged with taking $11.5 million in bribes for helping a meatpacker who had tax and loan problems.
Sigmundur David Gunnlaugsson, Iceland's Prime Minister, was the first victim of a leak of papers from the Panamanian law firm, Mossack Fonseca. In April, 2016, he stepped down, when it was disclosed that he and his wife owned an undeclared off shore account where he concealed millions of dollars from taxes. The papers reveal Mossack Fonseca also has formed off shore shell companies to help other clients launder money, dodge sanctions, and evade taxes.
Nigerian authorities fined the South African-based MTN multinational mobile telecommunications company $5.2 billion, later reduced to $3.4 billion. Of MTN's 62 million subscribers, the company failed to disconnect 5.1 million unregistered, and therefore unidentified, Sim card accounts. Kidnappers had used an unregistered Sim card from MTN to demand a ransom for Nigeria's former finance minister, Chief Olu Falae.
A November, 2015 report from the World Anti Doping Agency alleging State-sponsored doping of Russia's Olympic athletes could result in banning the country from competing in 2016's Summer Olympics. And the head of the agency that selects the countries that hold World Cup soccer matches had to resign, when winning host countries were found to have bribed their way into the honor.
In Indonesia, the government's failure to keep an up-to-date land registry results in an inability to assign blame for the devastating forest fires on the islands of Sumatra and Borneo that also have spread a thick haze of smoke to Malaysia, Singapore, and southern Thailand. All together, the smoke has caused an estimated 500,000 respiratory tract infections, and 100,000 premature deaths are a possibility. Fires are set by cheap slash and burn methods used to clear for new planting by both small scale farmers and corporate palm oil, timber (used for paper), and other agricultural corporations. Standards for the hiring and working conditions of migrant labor in the palm oil industry have failed to remedy abuses. When an investigation by the Roundtable on Sustainable Palm Oil found the Malaysian palm oil company, IOI, failed to correct deforestation violations in its concessions, Unilever and 9 other major companies cancelled their contracts with IOI.
You can read about charges of corruption Russia faces in the earlier blog post, "Hearing Voices." And Communist Party officials throughout China have been severely punished as reported in the earlier blog post, "China's Corruption Crackdown, New Bank Backing, and Release of PR Activists."
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