Teaching Comparative Government and Politics

Friday, April 27, 2012

Corruption and competition

Awhile back, I posted a link to an article that raised the question of how pervasive corruption was in Mexico. (Is extortion part of civil society?)

Now, a long and complex investigative report by David Barstow and his colleagues at The New York Times appears to confirm that even Mexico's largest employer spent millions, illicitly, to facilitate rapid growth in Mexico.

The NYT report is an investigation of Wal-Mart, but the question is implicitly asked, "Does either the Mexican or US government have the capacity and ability to stop or limit this kind of corruption?"

Vast Mexico Bribery Case Hushed Up by Wal-Mart After Top-Level Struggle

In September 2005, a senior Wal-Mart lawyer received an alarming e-mail from a former executive at the company’s largest foreign subsidiary, Wal-Mart de Mexico. In the e-mail and follow-up conversations, the former executive described how Wal-Mart de Mexico had orchestrated a campaign of bribery to win market dominance. In its rush to build stores, he said, the company had paid bribes to obtain permits in virtually every corner of the country.

The former executive gave names, dates and bribe amounts. He knew so much, he explained, because for years he had been the lawyer in charge of obtaining construction permits for Wal-Mart de Mexico…

Neither American nor Mexican law enforcement officials were notified. None of Wal-Mart de Mexico’s leaders were disciplined. Indeed, its chief executive… identified by the former executive as the driving force behind years of bribery, was promoted to vice chairman of Wal-Mart in 2008…

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