The Key to Clean Government
We all desire an honest and clean government, from our police officers to White House staffers. Singapore consistently ranks among the cleanest and most efficient governments in the world. Yet, just a few generations ago, graft had been a way of life. How did Singapore turn this around and what can we learn? In short, reason-based policies, trump political soundbites.
Singapore’s Initial Failures
Under British imperial rule, corruption, particularly the taking of bribes, was a commonly accepted practice. The battle against corruption began in 1871, when Singapore made such acts illegal with the enactment of the Penal Code of the Straits Settlements. But the new law had little impact because it lacked an enforcement mechanism.
No additional action was taken until 1937 with the enactment of the Prevention of Corruption Ordinance (POCO). With POCO, there now existed a means of investigating and prosecuting corruption. However, POCO’s investigative powers were narrow and punishments limited to small fines and a maximum of two years of jail time. Although an improvement on the status quo, it was not enough to act as a sufficient deterrent.
An Incentives-Based Approach
In the years leading up to 1960, Singapore’s government reasoned that corruption is a function of human cost/benefit analysis. The goal, therefore, was to change the perception of graft from a low-risk/high-reward activity to one that is high-risk/low-reward. That meant raising government salaries to make graft less attractive, while stiffening enforcement and increasing punishment.
At the time, Singapore was too poor to raise government salaries. Instead, they initially focused their attention on the risk end of the spectrum. Accordingly, Singapore strengthened its ability to investigate and prosecute corruption, dramatically raising the risk of getting caught. Jail terms were increased to up to five years, and corrupt gains became seizable, in addition to increased fines.
Singapore’s economy boomed in the decades that followed, enabling the city-state to tackle the rewards problem as well. Beginning in the 1970s, the city began raising civil servant salaries. Prime Minister LeeKuan Yew justified repeated salary increases, noting that it would reduce the temptation for graft and stem the brain drain of competent individuals to the private sector.
Today, Singapore’s government officials are among the “cleanest”…and highest-paid…in the world. Not surprisingly, it is generally regarded as one of the most efficient, as government jobs tend to also attract the best and brightest as well.
Going Further
The approach taken by Singapore, focusing on incentives, is both logical and parsimonious. Other countries have achieved similar results by reducing the opportunities for graft. Singapore's incentives approach can be combined with “sunshine laws” that require government officials to publicly disclose their assets, and “revolving door” laws that seek to close the revolving door between the public and private sector, eliminating opportunities for conflicts of interest before they arise.
While the West clings to the idealistic notion of the humble civil servant working for the people. It would behoove us to recognize that human behavior is a function of incentives, and politicians are not immune. Lofty pronouncements of “draining the swamp” will do nothing as long as civil servants rely on kickbacks to win elections and to supplement the income that they would have received in the private sector.
Rather than “tightening our belts,” we’d be better off raising government salaries and attracting better talent to public office. Spending a little more now may actually be cheaper in the long run as cleaner, more efficient government is a net positive for us all.