Honest Graft

I had lunch today at a shop selling 魯肉飯. (Note to non-Taiwanese readers: This is a bowl of rice with braised bits of fatty pork sprinkled on top. It’s a very traditional and humble Taiwanese dish.) There was a sign in the restaurant saying not to worry about the oil because the shop rendered all of its oil themselves from lard. I asked the boss if they had just put that sign up recently in the wake of the latest adulterated cooking oil scandal, and my question set off a diatribe of venom and disgust. At one point in the conversation, I threw out a general anti-corporate statement, saying something to the effect of, all big corporations will be corrupt if they have the chance. At that point, the boss said something that fascinated me. She half-rejected my statement. “We can live with modest amounts of corporate and government collusion” (我們還可以忍受一班官商勾結), “but they are poisoning us and destroying our business,” she exclaimed.

Well, of course I immediately thought of 19th century New York City, Tammany Hall machine politics, and George Washington Plunkitt. In the late 1800s and early 1900s, most American cities were run by political machines. Taiwanese might think of these as cousins of local factions. To simplify, machine politics worked something like this. A group of politicians won control of the city government, and systematically used the resources of city hall to feed their machine. Every contract was handed out to an ally, and every city job was given to a supporter. If you got a contract or a job, you had to donate a certain percentage of the profits or your salary back to the machine. Some of this money was used for welfare services, such as taking care of families who houses had burned down, whose breadwinner had been injured, or otherwise needed assistance. Some was used to mobilize votes on election day (when all the contractors and city employees were expected to mobilize their own social networks to get to the polls and vote for the machine candidates). The rest went into the boss’s pockets. Most of the machines were built on immigrant voters, especially the Irish, and they were usually part of the Democratic Party. As you might expect, the respectable middle class Protestant voters had nothing but disdain for machine politics. However, the machines had numbers, and they usually won.

New York had one of the most famous machines, named after its headquarters, Tammany Hall. Tammany Hall dominated New York politics for about a century. One of the more famous bosses was a garrulous gentleman named George Washington Plunkitt. Plunkitt did future political scientists the favor of expounding at length on his theory of government to a newspaper reporter who wrote it all down in a marvelous little book. For a rip-roaring read, I highly recommend Plunkitt of Tammany Hall.

At one point Plunkitt explains his concept of “honest graft.” Sure, he handed out contracts to his political allies. Sure, they made quite a bit of money on city contracts. Sure, the machine got kickbacks. But this was all honest graft. What was dishonest graft? Well, to see dishonest graft, you only had to look at what that horrible Republican machine in Philadelphia was doing. Why, those unscrupulous rascals would sell the roof off an orphanage to make money on the scrap materials! The Republican machine in Philadelphia simply had no sense of right and wrong. They didn’t understand that there were certain types of corruption that were acceptable and certain things that were beyond the pale.

Back in Taiwan in 2014, I think this is the line that the Wei brothers and their Ting-Hsin Corporation have crossed. When they leveraged their political connections to buy pricy real estate with unsecured loans and made huge profits, the public mostly just yawned. (There are also indirect kickbacks, as the Wei brothers are heavy KMT supporters. They also give a lot to Buddhist organizations.) Yes, that was disgusting, but they weren’t directly injuring anyone. That was closer to honest graft. Intentionally cutting costs by using industrial waste oil in their food oil products was different. That directly threatened normal people’s health and welfare. And since they supplied many other businesses, they have damaged Taiwan’s international reputation (Who wants to buy Taiwanese food products now?), caused serious financial pain for lots of small restaurants, and forced many bosses to reject one of the fundamental premises of modern economies – comparative advantage and division of labor – and go to the trouble of rendering their own oils from lard. This is not honest graft.

Let me make clear: I am not defending the idea of honest graft. I personally think that almost all so-called honest graft is actually fundamentally dishonest and corrosive to democratic societies. However, I think that many Taiwanese instinctively do make this distinction between honest and dishonest graft, though they may not necessarily think of it in those terms. To many people, some types of corruption are more acceptable than others. Today, I was surprised to find myself staring at the line dividing the two.

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