CORRUPTION Syndromes of Corruption

7 Official Moguls: reach out and
squeeze someone
Introduction: power, impunity, and the risk
of kleptocracy
In Influence Market societies powerful private interests threaten the
integrity of public institutions, but may be checked by those institutions
and by competing parties and groups. Elite Cartels stave off rising competition
by building corrupt networks, but they are restrained by the need
to balance off the interests of various elites and by the fundamental goal of
maintaining the status quo. Oligarchs face few constraints but still must
manage conflict among themselves and find ways to protect their gains.
But where state elites operate in a setting of very weak institutions, little
political competition, and expanding economic opportunities, the stage is
set for corruption with impunity. There Official Moguls – powerful
political figures and their favorites – hold all the cards.
In China, Kenya, Indonesia, and countries like them, corruption is
often rapacious and involves the unilateral abuse of political power rather
than quid pro quo exchanges between public and private interests. Official
theft of public land and resources, businesses owned by politicians and
military figures, or smuggling and tax-evasion schemes organized by
bureaucrats and including favored business people are not frequent in
Influence Market or Elite Cartel societies. In Oligarch and Clan cases
deals on such a scale are difficult to sustain in an uncertain and contentious
climate, and require protection from forces in the private realm.
In Official Mogul cases, however, there is little to prevent ambitious political
figures or their personal clients from plundering society and the economy.
‘‘Official Moguls’’ thus has a double meaning: officials and politicians
enrich themselves through corruption more or less at will, at times moving
into the economy by converting whole state agencies into profit-seeking
enterprises, and ambitious businesspeople with official protection and
partners take on a quasi-official status as they build their empires. Either
way the locus of power lies not within the state but with officials who use
political leverage to extract wealth. Boundaries between public and
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