Taxation and the control of the motorist

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Jack Straw, Corruption,
and the New World Order
By Dr Sean Gabb

For the past month, I have been brooding over an article I found in The
Guardian newspaper of last 21st June. "Straw declares war on corruption"
the headline reads. It tells how, pressed by the Organisation for
Economic Cooperation and Development, the British Government is planning
a new law. Bribery is to be made a more serious offence, and its legal
definition widened to cover acts not previously criminal. The most
important new offence will be bribery of foreigners committed by British
citizens abroad. It will be illegal, for example, for British companies
to offer bribes to get export orders, or for British individuals to
bribe their way out of foreign trouble. To enforce this law, the
authorities will use their existing or yet to be created powers of
surveillance - telephone tapping, burglary of houses and planting of
listening devices, monitoring of e-mails, and so forth.

Announcing the proposals in the House of Commons, Jack Straw, the Home
Secretary, said:

Corruption is like a deadly virus. It has no boundaries. We need to
fight it wherever it is found.

For too long dishonest individuals have profited at the expense of
undermining the integrity of professional and public life in this
country.

A few Conservatives, I imagine - though without Mr Hague's encouragement
or support - will oppose the Government on purely commercial grounds.
They will explain how in many countries, doing business is inseparable
from dealing with a swarm of ministers, officials and well-connected
businessmen, all holding their hands out for a bribe. Making it criminal
here to put money into those hands will hurt our export trade. At best,
companies will relocate their headquarters to other countries where they
cannot be prosecuted, or where similar laws are less fully enforced. In
any event, British workers will suffer.

This is a true objection, and I hope it is pressed very hard - such
being the best the Tories have to offer nowadays in defence of freedom,
and to be fair such being the argument most likely to have an effect on
the Government's legislative intentions. But it is not a full objection.
It does not sufficiently explain what is at once so dangerous and
arrogant about the proposals. And so I will make my own comment on them.
In particular, I will discuss the following issues: the blurring of
jurisdictions; the hypocrisy of our political masters; and what motives
can reasonably be ascribed to them.

1. Blurred Jurisdictions

Part of what makes our civilisation so unlike all others is that it has
never - or not since Roman times - been ruled by a single government.
Instead, power has been divided between many states, each able to make
whatever laws it pleased, but not on the whole to enforce these outside
its own borders. Roman law and the various European systems that derive
from it do assume a right to punish for crimes committed abroad. But
this has not been a right much insisted on. States have usually followed
the English practice of exercising extraterritorial jurisdiction only
where vital interests are threatened, or to punish horrible crimes that
would otherwise go unpunished.

Because power has been divided, it has been a less effective tool than
elsewhere for preventing the happiness and progress of mankind. It has
been possible for states to compete not just in war, but also in their
internal arrangements, and for those most successful at enabling
happiness and progress to gain at the expense of the others. Think of
the Huguenots who took themselves and their capital out of France, to
the enrichment of England, Holland and Prussia. They went to countries
similar enough to their own for them to assimilate without trouble, but
with very different religious and commercial policies. Fears of a
similar loss kept the French State under control for the next hundred
years. Or think of those who have become temporary refugees, able to
indulge their tastes abroad without risk at home. Think of Voltaire. He
lived in Geneva, where he could write as he pleased, but crossed into
France whenever he wanted to see a play - this being a pleasure banned
in Geneva. Think of A.E. Housman, who went every year to Venice to avoid
breaking the British laws against homosexual acts. Think of the millions
of young people from all over Europe who go nowadays to take drugs in
Amsterdam and return home to no penalty.

This diversity is now threatened. The proposed new law on corruption is
not an isolated disturbance of national sovereignty and limited
jurisdiction, but a stage in their destruction. For us in England, the
European Union is the clearest and most present threat to diversity. But
there are dozens of other bodies set up by treaty and working towards a
common juridical space. Those concerned with the "war" against drugs and
money laundering are standardising laws throughout the world, with the
eventual aim of a single enforcement. Those concerned with "crimes
against humanity" are already acting under a universal jurisdiction.
There are proposals for similar laws to protect the environment and to
disarm the human population. The corruption law is part of this
tendency. It is to be an extension of earlier precedents, and is to be
the precedent for other acts of the same kind.

The natural result of these acts combined will be a world government. On
account of its growth, this will not be a democratic government. In
form, it will be a web of supranational institutions, all exercising
powers delegated by national governments. In substance, it will be a
reasonably united élite, giving orders to more or less disunited
nationalities. There will be occasional dissent, as one nationality
tries to exercise its theoretical sovereignty. But as in the Habsburg
Empire, this will be first contained and then crushed by a directed
coalition of the other nationalities. Nor will it be desirable for such
a government to be democratic so long as the majority of its subjects
are semi-literate paupers with nothing immediate to lose from a
redistribution of wealth.

It will not be a particularly liberal government. In some places, it
will impose better standards of civility and due process than currently
exist. But for the more civilised portions of mankind, there will be a
perceptible levelling down. We can see this with the Corpus Juris, which
is a proposed criminal code for the European Union. Regardless of the
smiling assurances about human rights protection, its procedural
safeguards do not include trial by jury, habeas corpus, or a meaningful
rule against double jeopardy. We can see it in the international
treaties against drugs and money laundering. These all require signatory
states to reverse the burden of proof in criminal cases, to enact
arbitrary confiscation laws, and to abolish banking and other financial
privacy.

It is reasonable, moreover, to suppose that a world government would be
open to capture by any number of powerful interest groups; and the lack
of external competition would ensure that mistakes become not only
general, but also irreversible. The closest comparison I know is to the
world of late antiquity, when all the Greek and Italian city states and
all the surrounding kingdoms had come under the domination of Rome, so
that one civilisation had just one government. This was the world of
Commodus and Diocletian and Constantine, of civil tyranny and grinding
taxes and religious persecution, where an oppressed citizen had no
refuge but in suicide or flight to the savage realms beyond the
frontier. This kind of world will not come again in our lifetimes. Nor
might the common people be quite so impoverished next time. But the
fairly liberal world in which we do live is not the automatic product of
time. It rests on foundations that are being undermined one stroke at a
time. The proposed new law on bribery is one of these strokes.

2. Labour Hypocrisy

Let us, however, return to Mr Straw's words in Parliament:

Corruption is like a deadly virus.... We need to fight it wherever it is
found.

Brave words, even if dangerously mistaken. They must be read, however,
with certain implied reservations. For all they will be used to enslave
us, they are not intended to apply to Labour Ministers or their
relatives or friends or bed or business partners. We know this from the
following cases:

First, we have Peter Mandelson. Shortly before the 1997 general
election, he borrowed £373,000 from Geoffrey Robinson, a fellow Member
of Parliament on the Labour Benches, and put this towards buying a house
in London. The loan was arranged in secret, the contract being drafted
by a friend; and it was not entered in the Commons register of
interests. It gave Mr Robinson the right to impose a charge on the house
if repayments were not made in good order.

This loan arranged, Mr Mandelson then obtained a mortgage of more than
£100,000 from the Britannia Building Society. According to various
newspaper reports, he neglected to mention the Robinson loan. Since
building societies do not generally lend on property over which there is
or might be another charge, it is reasonable to suppose that he was
obtaining goods and services by deception and committing various other
offences described in Theft Acts.

These facts placed him into Mr Robinson's hands: one word and he might
be ruined. Suspicion is also reasonable, therefore, when on becoming
President of the Board of Trade, Mr Mandelson appointed Mr Robinson as
one of his ministerial deputies - a first promotion after 20 years on
the back benches.


Was this not one of those "dishonest individuals [who] have profited at
the expense of undermining the integrity of professional and public life
in this country"? Evidently not. When his conduct was discovered, Mr
Mandelson resigned from the Government. But there was no police
investigation into his behaviour. Today, he is back in the Government as
Secretary of State for Northern Ireland - a post that carries
responsibility for law enforcement in part of the United Kingdom. It is
said that he owed this easy treatment to certain intimacies that he once
enjoyed with the Prime Minister - intimacies that might be embarrassing
if ever made public.

Second, we have Mr Straw himself. On the 14th March this year, his
brother William went into a Nottinghamshire police station and confessed
to assaulting a 14 year-old boy. According to accounts published just
after on the Internet, the boy was his son and the assault was sexual.
He was not charged, and no further investigation was ordered.

Not a word of this alleged offence appeared in any of the established
media until the 5th April, when Punch carried a long but guarded report
on how the Government had leaned on every newspaper editor in the
country not to cover the story.

William Straw was eventually charged with a later common assault on a 16
year-old girl. This gained a few column inches in the newspapers, but no
further comment was made when all proceedings were dropped on the 19th
July.

Jack Straw is not responsible for his brother's real or alleged acts.
But he is responsible for the media blackout on reports about his
brother. And there is natural reason to believe that he obtained or
tolerated preferential treatment for his brother after the March
confession. According to a senior police officer quoted in the Punch
article, "it would be a very brave custody sergeant who would release
back into the community a man who had confessed to [such a] crime".

We have here a case on first appearance not of financial but of
political corruption. Will Mr Straw order an investigation of his own
actions or of what was done in his name? Probably not. Nor did he order
any investigation of the leniency with which his son was treated after
pleading guilty to supplying drugs early in 1998. Nor, I am certain,
will he insist on proceedings against himself for having recently
ordered his chauffeur to drive at 103mph to get him on time to a
political meeting.

Nor will there be any meaningful investigation of the claims that Tony
Blair's father in law has been fraudulently obtaining welfare benefits,
or that Gordon Brown bought a flat in London under suspicious
circumstances. Nor will there be even a mention allowed in the
established media of the still more alarming claims about the Cullen
inquiry into the Dunblane shootings, or of the claims about a guilty
plea made at Bow Street Magistrates Court back in 1983 by a person now
of the highest importance. Nor will it be discussed how the Government
is using the security services to promote its own electoral advantage -
something the Conservatives did only occasionally and then always as a
byproduct of fighting the Cold War - and how individuals like Robert
Henderson and Greg Palast have had their lives turned upside down for
the crime of upsetting senior members of the Labour Party.

All the above facts, and many others beside, can be explained only on
the assumption that our new political class thinks itself above the law.
It is no more than a matter of time before these people start murdering
their opponents.

A Question of Motives

I do not think it can be denied that we are ruled by a more than usually
scummy set of politicians, and that these are presiding over a steady
collapse into despotism. The only question worth asking is whether they
are responsible for this collapse in more than the purely formal,
constitutional sense - whether people like Jack Straw and Tony Blair
really can be supposed to want an international police state in which
actions and speech, and even thought, will be controlled by a
masterclass made up of people like themselves and their friends in big
business. In short, I am asking whether I can use that unfashionable and
greatly misunderstood word "conspiracy".

Aside from fears of being called a crank, there are two main objections
to speaking about conspiracies. The first is that conspiracy theories
are to politics what creationism is to biology. They raise hypotheses
not needed to explain what is being studied; and they prevent a full
understanding of the causes that are most likely have brought about what
is being studied.

Look at the money laundering laws. It is unlikely that anyone wanted
these simply because they were an engine of despotism. Police forces
wanted them because they opened a new and possibly more successful front
in their notoriously lost war on drugs. The big banks wanted them
because their complexity could be used to put smaller competitors out of
business. Administrators, both national and international, wanted them
because they opened a new area for regulation and thereby opened new
opportunities for status and promotion. The tax authorities wanted them
because they made it easier to detect and punish evasion. The
politicians wanted them because all these others wanted them, and
because nobody made a big fuss against them.

Where any attack on freedom is concerned, there are sectional interests
that benefit without having an overall agenda of control - and that may
even oppose other attacks from which they do not benefit. The proposed
new law on bribery and others of its sort can be better explained by a
public choice analysis than by claims of some grand conspiracy. If these
new laws are coming faster now than in the past, we need to bear in mind
that the techniques of control are better developed now than in the
past. Modern information technology enables sectional interest groups to
push for modes of surveillance and control that once only existed in the
minds of dystopian science fiction novelists.

Yet, but all is being said, a purely institutional analysis can be
pushed too far as explanation. It is a necessary condition, but is not
itself sufficient. Just because some people have an interest in
promoting a bad law, and because that law is technically possible, does
not mean that it will automatically be made. It must also be thought
right and proper by those with the power to make or refuse it.

For example, there were strong commercial interests in Victorian England
that would have gained from a return to protection after about 1870. In
Germany, in America, and in other countries, these interests prevailed.
Here, they did not prevail until 1931. The reason was not entirely the
strength of opposing commercial interests. It was also an autonomous
belief in the moral rightness of free trade. British manufacturers did
not put as much as they might have into "fair trade" campaigns, in part
because they thought it a rather shameful cause: and others campaigns
that were funded had no success against a political establishment
unwilling to listen to any case for protection.

The public choice analysis, then, can be used to explain how bad laws
are made. But it cannot by itself explain why some are made and others
are not. This throws us back to looking at the character and motivations
of those in power. Doubtless, there have been sectional interests hard
at work on persuading Jack Straw to make bribery an extraterritorial
offence. But why is he willing to do that, bad as its consequences will
be, and when he would scornfully reject equally strong pressure, say, to
bring in the death penalty for racially motivated murder? The natural
answer is that he approves of that particular law.

Here, though, we come to the second objection to claiming that Jack
Straw and his colleagues want a new despotic order. This is that they
are not self-consciously wicked people. Brian Micklethwait has been
arguing this point with me for over a year now, and I have no doubt will
continue arguing it for some years to come. His main point is that while
our rulers are doing things that will have bad consequences, they cannot
reasonably be accused of wanting these consequences. If they are working
to destroy our national independence, it is because they believe that
the resulting international government will abolish war and tyranny and
poverty. If they are destroying our liberal institutions, it is because
they believe these to stand in the way of their grand objectives. Their
ends are good, Brian says, but they are ignorant of how their chosen
means will not achieve these ends. His conclusion is that rather than
accuse these people of conspiring against liberal democracy, we should
sit them down and patiently explain to them the facts of which they are
currently ignorant.

Assuming that I understand Brian correctly, there are two counter
objections. First, he seems to have an unreal conception of wickedness.
Before attaching moral blame to our rulers, he wants to see them
behaving like pantomime villains - twirling their moustaches as they
confess their true intentions in whispered asides. But excepting a few
followers of Nietzsche or the Marquis de Sade, nobody is wicked in this
sense. Whether or not he deceives the world, every villain deceives
himself. Hitler and Stalin did not think themselves bad men. Though they
committed atrocious crimes, they claimed - and sincerely believed - that
what they did was right, or at least was the best that could be done in
difficult circumstances. Thieves universally demonise their victims as
people who have gained unfair advantages and who therefore have no right
to their property. Most murderers look on their victims as human trash
who are better off dead. Those criminals who do not blame their victims
take refuge instead in some sociological cant about the force of
upbringing or other external circumstances.

Of course, our rulers do not consciously intend to do evil. On their
lips and in their minds are only the fairest intentions. And they
believe in their own essential goodness in exact proportion as they
enrich and privilege themselves by trampling on the rights of others.

Turning to the second counter objection, Brian seems not to understand
the nature of ignorance as a defence to charges of wrongdoing. Both
lawyers and moral philosophers make a distinction between innocent and
culpable ignorance. The former is a good defence, the latter not.
Suppose a very young child picks up a loaded gun. Waving it around, he
kills someone. Treating the child as a murderer would be absurdly
unjust. He cannot be presumed to understand what he was doing, and so
cannot be held responsible. This defence would not be open to an adult
in the same circumstances. Because he knows - or can reasonably be
presumed to know - that pointing a loaded gun at someone is dangerous,
ignorance will be no defence. Even if it is accepted by a court, its
only effect will be to reduce a murder charge to one of manslaughter.

We can apply this distinction to politics. In living memory, our rulers
have committed two main derelictions. Before 1979, they acted on the
belief that unemployment was caused by a shortage of aggregate demand,
and that it could be cured by monetary expansion. They were wrong, and
they created a set of economic problems that nearly bankrupted the
country and that have taken a generation even partly to solve. But the
politicians in charge of economic management cannot be held responsible
for the outlines of their policy. They were busy men, without time or
inclination for subtle speculations of their own. They were advised by
men who were generally accounted the best economists of the day. They
looked at the Phillips Curve and heard all the talk of multipliers, and
were convinced by the analysis. Moreover, they had what they believed
were solid practical demonstrations. They thought they had seen the
failure of preKeynesian economics in the Great Depression. They thought
they had seen the success of Keynesian economics in the age of full-
employment and prosperity that had followed the War. No one can
reasonably blame them for not having read the works of Milton Friedman
and F.A. Hayek. These works were derided by the mainstream economists
when given any attention at all. For all they presided over an economic
disaster, the politicians of the day cannot be personally blamed for
what happened. They were ignorant, but innocently so.

Since then, however, the politicians have turned from wrecking the
economy to abolishing our rights and liberties. If this is the effect of
ignorance, it is culpable ignorance. Economics is a difficult subject
for most people, and there is much plausibility in the Keynesian
analysis - I know because I teach it. But only a very common education
is needed to know the probable effect of diluting the double jeopardy
rule or reversing the burden of proof in criminal proceedings, or
limiting freedom of speech and association, or handing effective power
from national and democratic institutions to unaccountable foreign
bureaucrats. Economics is not part of the standard curriculum that our
political class follows at university. But law and history are part of
that curriculum. Any politician who claims not to know the nature of
what is being done to us is either stupid or guilty of a self-deception
that would not stand up five minutes in a criminal trial.

And so it is legitimate to presume that Jack Straw and his colleagues
desire the natural effect of their actions. They do want a world in
which they are masters and we are slaves, even if they prefer to cover
this with fashionable euphemisms. Mortgage fraud and protecting their
relatives is only the surface of their guilt. Since the Glorious
Revolution, the custom in this country has been to work for the downfall
of bad rulers, but otherwise to leave them unpunished. The custom on the
other side, however, has been that the rulers should observe certain
limits to their misgovernment. These people have broken through the
restraints of custom. I see no reason why we the people of this country
should not also drop that restraint.

Dr Sean Gabb

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