I. Introduction
I.V Hypothesis
國
立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
11 before the launch of its special ACA in 2006. It had a law on Anti-Corruption and three provisions making bribery illegal. The task of upholding these laws fell solely on the General Prosecutor’s Office and the courts.
The second pattern involves anti-corruption legislation and multiple ACAs. Having multiple ACAs has negative effects on their efficiency. Sadly, in many cases there is overlap in jurisdiction and even competition between agencies. An example of this pattern is the Philippines with seven laws and a stunning 19 anti-corruption agencies.
The third pattern is of the type found in Singapore and Hong Kong. This pattern involves the implementation of anti-corruption law by a single, independent ACA. These are the Corrupt Practices Investigation Bureau (CPIB) in Singapore and the Independent Commission against Corruption (ICAC) in Hong Kong. These two countries, although small, have been the most
successful in combating corruption in the Asia-Pacific. Therefore this pattern is, by Quah, perceived as the most effective pattern.
With this model of causes of corruption and institutional anti-corruption measure patterns, we will be able to understand the contexts of corruption in our cases studies in a qualitative way.
I.V Hypothesis
My overall hypothesis is that the frameworks of the causes and curbs of corruption are essentially the same in both countries. In other words, corruption is a problem that appears in similar ways in both democratic and PRC-style authoritarian countries, because corruption trends are chiefly driven by reforms and trends driven by economic development.
Democracies were able to combat corruption more effectively than authoritarian countries, because almost all cases of the latter were unable to attain sustained economic growth and development.
‧
國立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
12 However, China has been growing economically since its opening up in the early eighties. Therefore I predict that it benefits from development in terms of corruption just like a democracy would.
If this proves to be true, we can make claims about a universal nature of corruption and additionally a universal method of curbing it. Additionally we can provide preliminary policy recommendations for both countries.
From the perspective of the framework I expect that the comparison of the two case countries shows a similar over time trend from mostly low level need-driven malfeasance towards increasingly grand level greed-driven corruption. First of all I expect that in the past (in the times of authoritarian Taiwan and early post-Mao China) civil servant salaries were very low, but have risen substantially since then. Additionally, I expect that during this time the civil servant examination system has become more rigid and complicated, thus bringing down opportunities and incentives for low-level corruption.
Moreover, I hypothesize that opportunities for corruption and red tape favor grand corruption more than low level malfeasance over time due to administrative reforms and increasing transparency and rigid requirements in accounting practices for the use of taxpayer money by local officials. Administrative reforms and the increasing complexity of red tape reduce opportunities for lower level officials to engage in certain acts of corruption. However, reforms are always implemented from the top.
Therefore, it might be creating loopholes that only the highest officials are capable of abusing, thus increasing opportunities for grand corruption.
In line with these reforms I expect the same trend to happen in the risk of detection and punishment of corruption. With increasingly transparent accounting, the risk of detection will become higher for low level officials, but due to increasingly complex red tape it might become less risky for high level officials. This again would reflect a shift from mostly need-driven- towards chiefly greed-driven corruption.
‧
國立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
13 The factor of culture plays a part in Chinese societies regarding corruption. A persistent gift giving culture and strong hierarchical ties all create a culture in which corruption is, to a certain level, seen as normal. However, since the Taiwan and China are both culturally Chinese, this factor in our framework mainly serves as a control factor, making these two cases highly comparable.
Additionally, I expect that lack of political will plays a similar role in both countries. The people leading both countries are currently split between younger, Western-educated politicians and members of the ‘old guard’ who potentially have more vested interests. This factor has a strong influence on anti-corruption politics in the following form. In terms of anti-anti-corruption the young and the old find a consensus at dealing with lower level corruption, but spending less effort on higher level
malfeasance.
I expect that this final factor is one of the reasons why both cases don’t have a single fully
independent anti-corruption agency. Both countries have multiple ACAs that answer directly to the top leadership.
I.VI Methodology
My methodology is twofold. First I will provide a literature study of the development of corruption trends in both Taiwan and the PRC.
Then I will provide an analysis of both cases following Jon S. T. Quah’s model for the frameworks of causes and curbs of corruption. This will be done through careful literature research of primary and secondary source material. This model has not been conceptualized and used outside Quah’s own work before. Quah has decades of experience studying corruption and his insightful pieces on corruption in Asia have inspired me to follow in his footsteps and use his model and apply it in a comparative context.
‧
國立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
14 This analysis will allow for a comparison of the two corruption contexts of democratic Taiwan and non-democratic China and will highlight the similarities and differences. Through this method I will be able to make conclusions about the relationship between political regime types and the contexts of corruption.
‧
國立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
15
II. Historical Literature Study of the Case of Taiwan
Taiwan’s postwar history has been dynamic. In 1949, the Chinese Nationalist Party, the
Kuomintang (KMT), retreated from the mainland to settle on the island of Taiwan after they lost the Chinese Civil War to the Chinese Communist Party. Upon arrival on the island, KMT Chairman Chiang Kai-shek established martial law. This is the official starting point of authoritarian rule on the island.32
Democratization started in 1986 when the Democratic Progressive Party (DPP) was founded and tolerated by the authoritarian regime. In 1987, Chiang Ching-kuo, Chiang Kai-shek’s son and successor, lifted martial law. After Chiang Ching-kuo’s death in 1987, Lee Teng-hui (KMT) succeeded him and became the first democratically chosen president of Taiwan in 1992.
Democratization was complete when the DPP won the presidential election on an anti-corruption platform in 2000 and effectively ended 51 years of KMT rule.
33
A good place to start analyzing a country’s levels and nature of corruption is Transparency
International’s Corruption Perception Index data of the country. This data can be found in Table 1 and Figure 1 below.
The important questions we will look at are: a) did democratization reduce corruption in Taiwan; and b) what are the causes of corruption in Taiwan?
Lee Teng-hui’s KMT was perceived as heavily corrupted. The DPP promised to end that when Chen Shui-bian won the election race on an anti-corruption platform in 2000. Their clean image was destroyed soon after as evidence arose of massive bribes being demanded by his wife for mediating
32 Yu, Chilik, et al. "Evolving perceptions of government integrity and changing anticorruption measures in Taiwan." Preventing Corruption in Asia. Ed. Gong, Ting, and Stephen K. Ma. Routledge, 2009. 189-190.
33 Yu, et al. (2009).
‧
國立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
16 in massive business deals. After losing the election in 2008, President Chen Shui-bian was arrested upon charges of embezzlement, taking bribes and money laundering.34
In 2009, the Hong Kong-based Political Economic Risk Consultancy (PERC) reported in its annual report on corruption in Asia that for the first time Taiwan scored lower than China in terms of corruption. China ranked 8th with a score of 6.16 (0=least corrupt; 10=most corrupt) and Taiwan ranked 10th with a score of 6.47. Chen Shui-bian’s successor Ma Ying-jeou rejected the finding and ordered the anti-corruption agencies in Taiwan to provide a report on major cases and a plan to amend the situation.
35 His first term in office was marked as one marked by relative stabilization of cross-strait relations and the establishment of a new ACA (Agency Against Corruption). His second term has, so far, been marked by popular mistrust as he is now commonly referred to the “9%
president” referring to his abysmal recent approval ratings.36
What are the more qualitative aspects of the trends in corruption practices in Taiwan? In the next section we will take a more qualitative look at common acts of corruption in Taiwan.
Regardless of his popularity,
Transparency International’s Corruption Perception Index has given Taiwan a stable score of 6.1 for three consecutive years since 2011, indicating stagnation but a peak in the trend the development of corruption.
34 Quah. (2011): 153-155.
35 Quah, Jon ST. Taiwan's Anti-Corruption Strategy: Suggestions for Reform. Maryland: Maryland Series in Contemporary Asian Studies, 2010. 1-2.
36 “Banyan: On the antlers of a dilemma.” The Economist. 29 March 2014. Web. 4 May 2014.
‧
Table 1: TI’s Corruption Perception Index of Taiwan (1995-2013)Year CPI Rank CPI Score No. of Countries
Note: CPI score ranges from 0 (most corrupt) to 10 (least corrupt) Retrieved from: www.transparency.org
‧
國立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
18 Figure1: TI’s Corruption Perception Index of Taiwan (1995-2013)
Note: CPI score ranges from 0 (most corrupt) to 10 (least corrupt) Retrieved from: www.transparency.org
II.I Corruption in Taiwan
Corruption was a major problem within the KMT ranks since its rule on the mainland. As Chiang Kai-shek tried to consolidate his power during the Chinese Civil war he collected an ever larger group of allies in the form of multiple warlords. Although his Nationalist army was large, it was very diverse and not very disciplined. The KMT suffered from factional struggles, corruption and low morale.37 These deep-seated troubles followed the KMT to Taiwan after the Japanese surrender in 1945 and the retreat from the Mainland in 1947. Although Chiang Kai-shek recognized that corruption was a problem in 1952 and initiated some reforms, including the exclusion of some leaders suspected of corruption and the raising of civil servant salaries, anti-corruption was never given priority during the period of martial law.38
Quah indicates that according to the 4,177 corruption cases listed in Taiwan’s annual Anti-corruption Yearbooks the most common forms of corrupt practices in Taiwan during 1989-2002
37 Quah. (2010): 11.
38 Ibid.: 12.
4.5 4.7 4.9 5.1 5.3 5.5 5.7 5.9 6.1 6.3 6.5
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
‧
were illicit gains (33.6%), malfeasance (19.3%), bribery (17.7%), misappropriation of public funds (16.3%) and graft (13%). Additionally, he shows that during 1989-1998 the majority of the suspects of corruption were civil servants. From 1999-2008 the majority were non-civil servants.39One of the most common forms of corruption in Taiwan is vote-buying. It can be defined as “the exchange of money or gifts for a vote between candidates or their agents (vote brokers) and voters during an election campaign with the aim of winning the election.
These numbers, however, do not tell us much as these numbers do not take into account the amount of money involved. Therefore, it is more beneficial for our research to take a closer look at common practices of corruption in order to establish the causes.
40 In most cases the gift is money.
Other gifts include hosting “election banquets, transfer of loans, increasing employees’ salaries, and payment of voters’ tax bills.41
When money is used to buy votes, the average amount is less than the salary of a day’s work. For this kind of vote-buying the goal is not to buy the vote, but to buy the loyalty of supporters and promote the candidate.
42
The next common form of corruption in Taiwan is Heijin or “Black Gold” politics. Hei means black, referring to the underworld, and jin means gold. Heijin is a common word in Taiwan referring to the
“penetration into politics of violent underworld figures and greedy business tycoons and the inevitable subsequent social ills such as vote-buying, political violence, insider trading, bid rigging, and official (and unofficial) corruption.”43
The abolition of martial law in 1987 had the consequence of increasing gang violence because of the release of many criminals who were arrested during an anti-organized crime campaign in 1984. In
39 Quah. (2010): 13.
40 Quah. (2011): 165.
41 Ibid.: 166.
42 Ibid.: 166-167.
43 Chin, K. L. Heijin: Organized Crime, Business, and Politics in Taiwan. Armonk: M. E. Sharpe, 2003. 8.
‧
國立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
20 1990 the Taiwanese government unleashed another clean-up campaign named “Operation
Cleansweep”. In reaction to these campaigns, some underworld figures transformed themselves into politicians or businessmen in order to keep themselves safe. In 1996, current president Ma Ying-jeou, who was the Minister of Justice at the time, launched a campaign to root out gangsters in politics. This campaign led to the arrest of around a hundred underworld figures, of which some were politicians.44
The problem of heijin politics can be attributed to the concurrence of the ambitions of politicians, businessmen and gangsters. Politicians rely on business for campaign funds and on gangsters to facilitate vote-buying. Businessmen rely on politicians for the procurement of permits and on gangsters for protection against victimization by other gangs and the settlement of private business disputes. Finally, gangsters rely on protection by politicians against the law and on the help of businessmen in the procurement of profits.45
The problem of Heijin politics is different from criminal penetration of politics in other countries, because “the integration of upper-world and underworld has contributed to the development of a morally confusing society where politicians are talking and acting like gangsters and gangsters are talking and acting like politicians.”46
II.II Anti-Corruption Measures in Taiwan
Anti-corruption measures in Taiwan can be separated into government offices charged with the task of anti-corruption, otherwise known as Anti-Corruption Agencies (ACAs), and anti-corruption legislature.
44 Quah. (2011): 168.
45 Chin. (2003): 16
46 Ibid.: 19.
‧
國立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
21 Taiwan has multiple ACAs. The first one is the Ministry of Justice Investigation Bureau (MJIB). It is the lead ACA in Taiwan. The official task it has been charged with is the “the investigation and prevention of matters that may jeopardize national security and violate national interests; matters which shall be stipulated by the Executive Yuan.” Its two primary missions are to protect national security and investigating major crimes. The government bureau has nine official functions:
- Prevention of sedition - Prevention of treason
- Prevention of unauthorized disclosure of national secrets - Investigation of corruption, bribery, and vote-buying - Prevention of drug trafficking
- Coordination in handling cases of organized crime
- Prevention of significant economic crimes and money laundering - Investigation of national security matters
- Other investigations and prevention of matters as assigned by superior authorities concerning national security and interests
As we can see only the fourth and last functions are actually related to fighting corruption.
Additionally it needs to deal with “counter-infiltration from the PRC, prevention of infiltration from other countries, counter terrorism, protection of national secrets, domestic security investigation, coordination of national internal security, and research on cross-strait relations. Furthermore it is responsible for investigating public corruption, malfeasance and election fraud; economic crime;
drug crime, money laundering and [online] crime.”47
47 Quah. (2010): 54.
Therefore we can state that the MJIB is not a
‧
The origins of the Ministry of Justice Investigation Bureau go back to the establishment of the Investigation Bureau of the Ministry of Interior in Kuanchew in 1949. It relocated to Taipei in December of the same year.
It was the lead ACA until the establishment of the Agency Against Corruption in 2011. We will expand upon their relationship later.
49
The MJIB formed the Corruption Elimination Department in February of 1989 and assigned a staff of 505 people and took over anti-corruption activities again. It was separated into five sections. The first was charged with the planning, promotion, supervision and evaluation of anti-corruption work.
The second and third were assigned the planning direction of anti-corruption activities in northern and eastern Taiwan and in central and southern Taiwan respectively. The fourth section was concerned with reports and prevention or corruption and the fifth was responsible for secretarial work of the Supervision Committee of Ethical Affairs of the Executive Yuan and investigations transferred form the ethical affairs units that we will discuss in the next section. The CED was established following the experiences of relatively successful anti-corruption activities of the ICAC in Hong Kong and the CPIB in Singapore.
On June 1st, 1956 it assumed responsibility for major investigation and internal security issues concerning national safety and violation of national interests and was
renamed the Investigation Bureau of the Ministry of Judicial Administration. Dealing with the offense of ‘corruption and abuse of power’ was one of its responsibilities. In May 1979 the
Economic Crime Prevention Center was established and took over the anti-corruption activities. In 1980, the judicial system was reorganized and the Investigation Bureau was renamed the MJIB.
50
In February 1991 it was renamed the Anti-Corruption Division (ACD) and the five sections were charged with new responsibilities. “Section I was entrusted with the acceptance of various reports of
48 Quah. (2010): 54.
49 Ibid.: 54.
50 Ibid.: 55.
‧
國立 政 治 大 學
‧
N a
tio na
l C h engchi U ni ve rs it y
23 impeachment and management of various clues concerning corruption cases. Section II was
responsible for checking the clues and the investigation and supervision of general corruption cases.
Section III dealt with the investigation, prosecution, supervision of special cases and cases referred by the Executive Yuan, Control Yuan, and other government agencies. Section IV was given the task of preparing cases studies, conducting research and providing analysis and suggestions for improving the ACD’s anti-corruption efforts. Section V was responsible for the planning, controlling, evaluating, and execution of the anti-corruption task by collecting relevant statistics, compiling anti-corruption regulations, and coordinating the efforts of the relevant government agencies. A Special Team was also formed to prevent and investigate public construction fraud.”51 The second ACA is the Agency Against Corruption (AAC), previously known as the Department of Government Employee Ethics (DGEE). The Agency Against Corruption was established recently in 2011 and took over the supervision of Government Employee Ethics Units from the previous DGEE. According to the Anti-Corruption Yearbook 2012, the AAC is “a composite organization that fulfills both the functions of corruption prevention and corruption eradication and is
responsible for the tasks of promoting anti-corruption policies, anti-corruption tasks, corruption prevention, and corruption eradication. […]. The staff responsible for investigating corruption and related crimes has judicial […] powers. AAC also initiated the groundbreaking “resident prosecutor”
system with district prosecutors selected by the MOJ stationed at the AAC and becoming directly involved in the AAC’s investigation procedure to improve the quality of evidence gathering and the efficiency of the investigation.”52
The origins of the AAC are found in July 1953. The Taiwanese government formed a security office for maintaining internal security control. Fighting corruption was not a part of their assignments yet.
Although it states that the AAC is an independent government
Although it states that the AAC is an independent government