Financial Scandal, Corruption & Censorship: Part 2

Part 2: When Knowledge is Exchanged

…to engage in corruption, and to expect to survive in public life is to have either a generous faith in the mechanisms of secrecy or a confident sense of what one can get away with in the event that activities hitherto hidden are suddenly made visible to others. —John B. Thompson, in Political Scandal

Please note: the following is the second part in a series of posts:

Part 1: Introduction
Part 2: When Knowledge Is Exchanged
Part 3: Case Study A: the Beeching ‘Axe’
Part 4: Case Study B: the Newby-Mandelson ‘Axes’
Part 5: Scandal in the Times of the Internet
Part 6: Conclusions: Financial Scandal and Neoliberalism

In Political Scandal, John B. Thompson explains that the word ‘corruption’ is derived from Old French, and from the Latin corrompere. The term first appeared in the English language in the 14th century, and was used to describe ‘the disintegration, decomposition or spoiling of a body or substance’. According to Thompson, ‘This included not only the process of physical disintegration (as in the decomposition of a human body after death), but also the process of moral deterioration or decay’(1).

Today the notion involves two key elements: first, the infringement of rules, conventions or laws concerning the proper exercise of public duties for the purpose of private, pecuniary or personal gain; and second, the perversion or undermining of the standards of integrity associated with public office (2).

Thompson notes that not all corruption results in scandal, and not all scandal is the result of corrupt actions. In this series of posts, I would nonetheless like to focus on acts of corruption—or alleged corruption—that do go on to become scandals. This raises the question: how and when can we say that corruption becomes a matter of scandal?

Thompson explains that the word ‘scandal’ has an Indo-Germanic root, ‘skand-’ (to spring or leap), whose early Greek derivatives (e.g. skandalon), were employed figuratively to signify an obstacle, a trap or a ‘cause of moral stumbling’(3). Later meanings of the term reflected the influence of Judaism and of Christian thought. The latter gave emphasis to individual culpability; ‘if individuals stumble and lose their way, if they commit sinful acts, this may stem from their own inner weakness and fallibility’(4). In time, this religious connotation was attenuated by increasingly secular meanings, including the ideas of scandal as ‘actions, events or circumstances that were grossly discreditable’; or ‘conduct which offended moral sentiments or the sense of decency’(5). Thompson’s own working definition of the contemporary meaning of scandal is ‘actions or events involving certain kinds of transgressions which become known to others and are sufficiently serious to elicit a public response’(6).

Thompson highlights the following characteristics of scandal:

First, there is great variability as to what norms and values (or the transgression of), lead to scandal. What counts as scandal in one cultural context may not count as scandal in another. Moreover, as Thompson’s historical contextualisation of scandal reveals, the ‘threshold’ of scandal may either strengthen, or become eroded in time within a given social or political context.

Second, the actions that become a matter of scandal typically involve a degree of concealment or secrecy, but they nonetheless become either known by others, or come to be strongly believed to exist by others. ‘Individuals who engage in activities which transgress some norm or code will commonly seek to conceal them from non-participants [non-participants in the scandalous activities], or at least to prevent the activities from becoming generally known…[However] To become a scandal, an action or event must be known about by others, or strongly or plausibly believed by others to exist…Unlike corruption or bribery…scandal is always to some extent a “public” affair’(7).

Third, scandal presupposes not just a degree of public knowledge, but also, of public disapproval. Indeed, Thompson notes that for a scandal to emerge, it is necessary for individuals to express their disapproval to others, and to do this by way of what he describes as ‘opprobrious discourse’: a moralizing discourse which ‘reproaches and rebukes, which scolds and condemns, which expresses disapproval of actions or individuals. It is a discourse which carries the implication that the actions are shameful or disgraceful, and hence carries the implication that the actions bring shame, disgrace, or discredit to the individual or individuals who performed them’(8). This public dimension of scandal is not only an integral aspect of scandal (as opposed to the idea that it is no more than retrospective commentary), but also, the one that makes it possible for it to become what Thompson describes as a ‘mediated event’— one that is taken up by the media of mass communication, a subject that we will return to towards the end of this series.

Fourth, scandal may threaten the reputation of the individuals involved by disclosing hitherto covert activities which transgress some values or norms; ‘…the damage or loss of reputation is a risk which is always present as a scandal erupts and unfolds. We could put it like this: scandal is a phenomenon where individuals’ reputations are at stake’. Thompson adds that, ‘[k]nowing that their reputations are at stake, the individuals at the centre of scandal may make a concerted effort to defend their reputations, or clear their names, by launching a counter-attack. They can do this in various ways. They can threaten legal action…[or]…the individuals can simply reject the allegations and deny that the transgressions took place, or deny that they were involved’(9). These and other strategies are inherently risky. On the one hand, any bluff behind a threatened action in a court of law may be called, or the court may decide against the individual who tries to suppress public disclosure of the events at the centre of the scandal. On the other hand, public denials may shift attention towards the possibility of what Thompson describes as ‘second order transgressions’, additional activities whose disclosure ‘can be even more damaging for an individual’s reputation than the disclosure of the original offence’(10). To be sure, and as Thompson notes in his analysis of mediated scandals, ‘as mediate scandals unfold, the individuals at the centre of them become caught up in a process that is very difficult to control, and in which their attempts to exercise control can easily become unstuck’(11).

* * *

In the following weeks, I will be employing these and other aspects of Thompson’s framework to develop an account of the relationship between corruption and financial scandal in New Labour’s Britain. According to Thompson, financial scandals in the political field ‘are based on allegations about the misuse of money or other financial irregularities. They generally involve the disclosure of hidden linkages (or allegations about hidden linkages) between economic and political power, linkages which are regarded as improper and which, on being disclosed, precipitate the scandal’(12). Thompson distinguishes between four different forms of financial scandal: a first kind involves bribery—the improper exchange of economic resources (money, gifts, etc.) for the purpose of influencing political decisions or outcomes. A second kind involves fraud, the misappropriation of public funds, deception, or indeed the misuse of information for personal or private gain. A third type involves various forms of electoral corruption and malpractice, including gerrymandering or the bribing of electors. A fourth type, which is the one we will be most concerned with in this series, involves ‘the existence of private, undeclared financial interests which might conflict, or be seen to conflict, with a politician’s public duties and responsibilities’(13). As Thompson notes, ‘[m]any of the infringements which underlie financial-political scandals could be loosely regarded as forms of corruption’(14).

Why my interest in this kind of scandal? As I have noted in several other EcoLogics posts, and as I began to explain in the introductory part of this series, I don’t accept the view that, in contemporary British culture, financial scandals of the kind that involve a conflict of interest between public duties and personal or private interests can be dismissed as ‘states of exception’ in an otherwise ‘clean’ political culture. On the contrary, I regard what Seumas Milne has described as a creeping ‘culture of corruption’(15) as an integral feature of the kind of neoliberal regime which began to be instituted after Margaret Thatcher was elected to office in 1979, and which was, if anything, radicalised after New Labour came to power in 1997.

In this context, I am interested in employing Thompson’s approach to explain what is unique about the relation between corruption and financial scandal in Britain’s contemporary political culture. While I think that Thompson’s theory goes a long way in explaining the relation today (and this despite the fact that the book was published almost 10 years ago), I will argue that his approach needs to be further developed (or at least specified) in order to provide an account of a logic which is arguably at the heart of many contemporary financial scandals, and which involves what I will describe as Knowledge Exchange.

In its simplest form, knowledge exchange may be defined as the sharing of information between individuals or groups of individuals. On this level of analysis, knowledge exchange is at once a routine, and an essential aspect of everyday life. However, aspects of this process acquire a rather different significance when the knowledge that is exchanged is vital to the accumulation of what Thompson describes as economic, political and/or symbolic forms of power; and when knowledge exchange involves a crossing of (or an attempt to cross) the public/private divide in the economic sense of the term. When these two conditions co-exist, the risk of committing an act of corruption, and of incurring a full financial scandal are likely to increase. If, though, I make liberal use of ‘ifs and whens’, it is because I will argue that, in contemporary political culture, the boundary between the public and the private (again in the economic sense of the divide) has become so porous that at least some individuals and institutions feel entitled to cross it at will. Despite this, it is one of the many peculiarities of our times that individuals and institutions that do cross the boundary may still use all available means to ensure that their actions remain private in the ‘visibility’ sense of the public/private divide. This includes, of course, censorship by way of libel and other laws.

It is here that the role of the mass media—and in particular of newer media such as the internet, and blogs such as this one—may complicate what we might describe as efforts to manage the visibility of knowledge exchange. Towards the end of the series, I will thus be particularly interested in examining how financial scandal (and indeed knowledge exchange) have been affected by the changing mediascape.

Next week I will begin to develop this account by way of a comparative case study about financial scandal and knowledge exchange in two different periods: the Britain of the early 1960s, and Britain in the early part of the 21st century.

References

1) John B. Thompson (2000) Political Scandal: Power and visibility in the media age. Cambridge: Polity Press, p. 28.
2) Political Scandal, op. cit. p. 28.
3) Political Scandal, op. cit. p. 12
4) Political Scandal, op. cit. p. 12
5) Political Scandal, op. cit. p. 13
6) Political Scandal, op. cit. p. 13
7) Political Scandal, op. cit. p. 18
8) Political Scandal, op. cit. p. 20
9) Political Scandal, op. cit. pp. 22-23
10) Political Scandal, op. cit. p. 23, emphasis added.
11) Political Scandal, op. cit. p. 62
12) Political Scandal, op. cit. p. 159
13) Political Scandal, op. cit. p. 160, emphasis added
14) Political Scandal, op. cit. p. 160
15) S. Milne ‘A culture of corruption has seeped far into government’, in The Guardian online, 1 July 2009, at http://www.guardian.co.uk/commentisfree/2009/jul/01/corruption-business-government-transport-health, accessed 3 February 2010.