Beating Corruption with Fake Bribes

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Quote:Beating Corruption with Fake Bribes
Bribe Fighter: The strange but true tale of a phony currency, shame, and a grass-roots movement that could go global
By Jeremy Kahn
April 4, 2010

NEW DELHI — What good is a currency that is not even worth the paper it’s printed on?

That’s the intriguing question raised by the new “zero rupee note” now circulating in southern India. It looks just like the country’s 50 rupee bill but with some crucial differences: It is printed on just one side on plain paper, it bears a big fat “0” denomination, and it isn’t legal tender.

The notes do, however, have value to the people who carry them. They’re designed as a radical new response to the pervasive problem of petty corruption. Citizens are encouraged to hand the notes to public officials in response to the bribery demands that are almost inescapable when dealing with the government here. Bribes for access to services are so common they even have an accepted euphemism — asking for money “for tea.”

The notes, printed and distributed by a good-government organization called 5th Pillar, include the phrase that the bearer “promises to neither accept nor give a bribe.” The idea is that by handing one of these zero rupee bills to an official, a citizen can register a silent protest — and maybe even shame or scare a corrupt bureaucrat into doing his duty without demanding a bribe for it.

In one sense, the idea seems absurd — fighting a serious problem like entrenched corruption with something that looks like a prank.

But remarkably, the zero rupee note appears to work, as 5th Pillar says it has found in hundreds of cases

And in its success, the worthless bill is upending the conventional wisdom that cleaning up petty corruption is a monumental task requiring complicated and expensive solutions. Along with the success of some other simple anticorruption ideas being tried in other countries, the zero rupee note is reinforcing research widely considered to hold promise in a vexing global battle: Big improvements in ending corruption, it suggests, can come from small changes in the environment that allows it to happen.

To understand why this idea is so revolutionary, it helps to understand how pervasive corruption is in a country like India, and how helpless most people feel about fighting it.

As in many developing countries, Indian officials tend to regard little payouts as almost a prerogative of the job. Brazenly asking for “tea money” for processing a housing application or registering a business is standard operating procedure in many government offices. Those who have government jobs will often have had to pay large bribes to state politicians to get them, so these employees, in turn, feel they must earn that money back by soliciting bribes from average citizens. Transparency International, the global anticorruption organization, found that petty corruption in India is particularly rampant when citizens have to deal with the police, land registration, and housing authorities.

Since even small bribes can often be out of reach for those living on less than a dollar a day, that means many of the world’s poorest are denied basic services to which they’re legally entitled, such as a copy of a birth certificate, connection to a municipal water supply, or even access to medical care. “For the affluent, corruption is at worst a nuisance; for the salaried middle class, it can be an indignity and a burden; but for the poor, it is often a tragedy,” Shashi Tharoor, a former United Nations spokesman who is now a junior minister in India’s Cabinet, wrote on his popular blog last year.

At a broader level, corruption can make a significant dent in a developing country’s economy. The World Bank has estimated that corruption can shave a full percentage point from a country’s GDP growth in a given year, a difference that can amount to tens of billions of dollars for a nation like India.

The usual tools used to fight corruption operate from the top down, and tend to be expensive and time-consuming to implement. One common approach is to use technology, such as computerized systems to process things like railway ticket sales or requests for copies of land deed records, taking corrupt humans out of the bureaucratic machinery altogether. Another is enacting good governance reforms, such as independent corruption investigators, higher public sector salaries to decrease the incentives for bribery, and streamlined regulations to eliminate unnecessary licenses or permissions.

The zero rupee note is different: It is a low-cost, low-tech solution that works from the bottom up, not the top down. The note was first conceived in 2001 by Satindar Mohan Bhagat, a professor of physics at the University of Maryland, who was dismayed by the constant bribe demands he had to contend with on trips back to his native India. He began distributing the zero rupee note to other Indian expats in the Washington, D.C., area, encouraging them to use the bills to resist paying bribes whenever they traveled back home. Among those Bhagat met at Indian community events in Washington was Vijay Anand, a software programmer and systems administrator, who had moved to the United States in 1997.

Anand was also deeply troubled by the extent of corruption he encountered in India. “We like to call corruption India’s national language,” he said in an interview. And in 2006, when Anand decided to move back to India, he wanted to do something to change India for the better. “After living in the US, I realized that India needs to imbibe a lot of qualities from the West that are often ignored,” he said — meaning, among them, ethics in public service and accountability in industry.

Anand soon met some social entrepreneurs in the southern Indian city of Chennai who had formed a group called 5th Pillar; he ended up as its president, and thought it might be worth trying Bhagat’s idea of a zero rupee note.

With Bhagat’s permission — and after securing a legal opinion that printing the notes would not violate Indian counterfeiting laws — 5th Pillar began printing zero rupee notes and distributing them throughout the southern Indian state of Tamil Nadu. The first batch of 25,000 was given away in 2007. 5th Pillar went to villages, schools, and university campuses and held 90-minute teach-ins to educate people about the problem of corruption, at the end of which they gave away the notes. The group also approached people on the street in public places to give the notes away.

Soon, people began coming back with success stories, and asking for more zero rupee notes to use. The group has now distributed close to 1 million notes, Anand said, and has begun branching out from Tamil Nadu to neighboring states, including Maharashtra, home to India’s bustling financial megapolis, Mumbai.

Raj Rajkumar, a small businessman in the southern Indian city of Coimbatore, is among those who have used the zero rupee note successfully. In a phone interview, he said he expected to be asked for a bribe last October when he went to register a nonprofit charity that he and several colleagues had established to help the disabled. And in fact, when he and the six other trustees of the charity arrived at the registry office, the clerk told them that there were some “formalities” that might hold up processing the application unless the group handed over 3,000 rupees (about $70) “for tea.”

Instead of handing the clerk the money, he slipped him the zero rupee note. The dumbstruck clerk, Rajkumar said, looked at the note and initially insisted he was only asking for “a tip,” not a bribe. But when the supervising registrar overheard the conversation and examined the zero rupee bill, she immediately ordered the clerk to process the charity’s certification. “Later the registrar told us that this was the very first trust that had been ever registered without having to pay a bribe,” Rajkumar said.

This does not seem to be an isolated case: 5th Pillar claims to have recorded hundreds of cases where citizens have managed to escape paying bribes by handing over the bills. In one instance, a corrupt bureaucrat apologized and returned money he had previously extorted from a village to connect it to the electrical grid. In another, an official who had just asked for “tea money” from an elderly woman stood up, offered his seat to her, brought her a real cup of tea, and then approved the loan she needed for her granddaughter to go to college. 5th Pillar’s success rate has not been independently verified, but Anand said there have been almost no instances in which someone has handed over a zero rupee note to an official and the official has continued to insist on a bribe.

The zero rupee note has attracted attention from the World Bank, which recently highlighted 5th Pillar’s work on a widely read blog that focuses on corruption. Anand said that 5th Pillar has also received interest from anticorruption advocates in other countries, including Argentina, Mexico, and Nepal.

The zero rupee note is not the only low-tech solution that has proved surprisingly effective in combating petty corruption. In Kathmandu, Nepal, staff at the international airport were recently issued pants without pockets in an effort to curb bribery. In Kazakhstan and Malaysia, governments have experimented with making officials wear badges that read “I am against corruption.”

Admittedly, some of these low-tech, simple solutions have limits. None of them are likely to reduce large-scale corruption such as multimillion dollar kickbacks for road or defense contracts. Their success may also be fleeting. Fumiko Nagano, who writes the World Bank’s anticorruption blog, has called ideas such as pocketless uniforms and anticorruption slogans “a band-aid covering up an infection,” likely to stop working as soon as enforcement slips.

The zero rupee note and the other simple solutions to corruption, however, have social science on their side. Much recent research has found that people’s perceptions of social norms — the basic unwritten rules that govern behavior within a society — are the biggest determinants of unethical behavior. If a person believes corruption is the norm, and thinks that everyone else is doing it, then he is far more likely to seize the opportunity to solicit a bribe. But the same research shows that it can be surprisingly easy to alter these norms. Experiments have shown that simply reminding someone of what is ethical before presenting her with a corruption opportunity greatly decreases unethical behavior.

The zero rupee note does this explicitly, with a printed reminder of what’s right. It also may trigger a “fear factor” — experiments suggest that reminding people they might actually be caught has an even more powerful effect on reducing corrupt behavior. 5th Pillar’s Anand said that the zero rupee note — a piece of paper with the official appearance of currency and a bold ethics reminder — definitely scares bureaucrats. “They don’t know how to react,” he said, “so they think it is easier to react in a positive way and get the job done rather than risk trouble.”

Far more important may be the note’s effect on the citizen using it. Anupama Jha, the head of the Indian arm of Transparency International, said she likes the zero rupee note because it changes the perceptions that citizens are powerless to resist bribe demands and that bribery is acceptable. Research has shown that this, in turn, can have profound implications for the overall level of corruption in society. Using game theory to model a corrupt society, Cristina Bicchieri, a professor of philosophy and legal studies at the University of Pennsylvania, and Carlo Rovelli, a physicist and philosopher at the University of Pittsburgh, found in a 1995 study that the introduction of just a few honest individuals who refuse to go along with corruption will, over time, result in honesty becoming the new social norm.

The key to getting people to stand up in the face of bribe demands, according to Anand, is letting them know they are not alone. The zero rupee note does this by showing citizens that there is an organization, namely 5th Pillar, that will back them up. “It tells the corrupt official: I am not alone, I am part of an organization,” Anand said. And 5th Pillar does go after corrupt officials, helping to conduct sting operations along with government law enforcement agencies.

Nagano, the World Bank anticorruption blogger, praised the zero rupee note because it depends less on deterring corrupt officials than it does on convincing citizens to stand together and resist. “For people to speak up against corruption that has become institutionalized within society, they must know that there are others who are just as fed up and frustrated with the system,” she wrote in praise of the zero rupee project. “Once they realize that they are not alone, they also realize that this battle is not unbeatable.”

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