Dark Money Politics: Why Europe Should Join Biden’s Fight Against Corruption

Written by | Saturday, August 21st, 2021

The anticorruption fight and its failures have begun to transform Western politics. Donald Trump won the US presidency in a campaign that decried graft among politicians in Washington, clearing the way for four years of unrepentant self-dealing in the White House and havoc in the transatlantic relationship. Key members of the British government travelled a similar path to power, playing on ideas about a venal Brussels elite in a campaign that led to the United Kingdom’s departure from the European Union. Authoritarians in Hungary and Poland have corrupted state structures so thoroughly that, at one point last year, the EU appeared to stake its future – in the form of its budget and its coronavirus recovery fund – on strengthening the rule of law in those countries. Public discontent with corruption, real and imagined, has unsettled Western societies. Yet Europe and the United States have an opportunity to redirect this energy towards strengthening their political systems and renewing their alliance.

The opportunity has arisen out of two recent developments. The first is the advent of Joe Biden’s presidency, which came shortly after the US Congress passed some of the strongest anticorruption legislation in decades. Layered within the National Defense Authorization Act, the legislation is designed to outlaw the anonymous US shell companies that have long benefited corrupt leaders and criminal organizations across the world. Biden has begun to build on this by prioritising initiatives to “close the loopholes that corrupt our democracy”, as he put it during his presidential campaign. The State Department announced in February 2021 that it would counter this “global threat to security and democracy” by enacting reforms that fulfill the US’ international commitments on anticorruption, and by strengthening institutions that protect the rule of law, as well as civil society.

The second development is Europe’s post-Trump effort to rebuild the transatlantic relationship. In a joint statement following its June 2021 summit with the US, the EU stated that it would “lead by example at home” through “concrete actions to defend universal human rights, prevent democratic backsliding and fight corruption”. This came days after the Biden administration imposed anticorruption sanctions on several politically influential Bulgarians – measures that were long overdue. In the build-up to the administration’s planned Summit for Democracy, European states have a strong diplomatic incentive to address the causes of widespread public concern about graft: 62% of EU citizens say that government corruption is a “big problem”, according to a survey Transparency International conducted late last year.

Domestically, this means punishing and deterring blatantly illegal abuses of entrusted power – as well as acts in a legal grey zone that cause voters to see the political system as corrupt – and strengthening the institutions that prevent such abuses. Internationally, it means countering authoritarian states’ increasing use of what Biden calls “strategic corruption” to achieve their political goals in various regions, not least Europe. Such threats often form part of a continuum that runs across national borders – as he observed in 2018, commenting that “there is ample evidence of dark money penetrating other democracies, and no reason to believe we are immune from this risk.”

For Western policymakers who focus on anticorruption, much of the challenge lies in countering graft in ways that citizens notice, understand, and support. The complex and obscure nature of many corruption networks – running through weakly regulated, low-profile legal and financial structures in multiple countries – is hard to fit into a compelling political narrative about a government’s commitment to the rule of law. The challenge is particularly acute in relation to strategic corruption, which is motivated by not just personal gain but also a competition for influence between states. Biden argued in 2017 that authoritarian leaders are able to use this form of corruption as a weapon due to “the difficulty of proving that it even exists, or that its purpose is political”. As far as most citizens of Western countries are concerned, many anticorruption initiatives are similarly invisible. Such initiatives are often diffused across a range of government bodies that voters are unlikely to associate with the anticorruption fight either in their own societies or as an element of foreign policy, such as relatively low-profile financial regulators and units in intelligence agencies.

Hence the US and Europe should strengthen their defences against graft in a way that has sustainable public support. To achieve this, they should establish national anticorruption institutions of a kind unseen in the West. In time, the U.S. government and its European counterparts should ensure that these institutions collaborate with one another – as part of a network designed to counter kleptocrats and other powerful corrupt actors who threaten the Western alliance. The institutions would coordinate domestic and external anticorruption efforts, while helping facilitate foreign governments’ work in areas such as judicial and security-sector reform.

‘Dark Money Politics: Why Europe Should Join Biden’s Fight Against Corruption’ — Policy Brief by Chris Raggett — European Council on Foreign Relations / ECFR.

The Policy Brief can be downloaded here

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