Since I don't now music about corruption, I proposed a chilled drum and bass track:
Dino & Terry - Croque Monsieur
Looking back to Soviet times the Georgian SSR was well known for its high level of corruption. In systems with only one political party corruption is a quite logical consequence. I Georgia corruption was so ubiquitous that the the Soviet leaders replaced in the 1970s the leader of the Georgian SSR, Vasil Mzhavanadze, because of his corruption. This was an extraordinary action because the soviet republics were autonomous.
Nevertheless the corruption continued to block the development of the country for decades. For example people told me that traveling in Georgia was expensive because the police wanted to be bribed at road blocks. If you did not pay, your car was blocked. I could make my own similar experiences with corruption in Bosnia. It is clear that it is impossible to have a successful business running in such conditions. But after the collapse of the Soviet union the industry collapsed as well and many people were unemployed. The few money the Georgian state had was mostly consumed by corruption.
It is easy to identify corruption as one of the main problems of a country, but how to overcome it? One certainly needs some unorthodox actions and this is what the government of Mikheil Saakashvili did after the Rose revolution in 2003.
- For example they fired the entire street police and built up a new one with new recruits and also with former police men who had to apply for their former job. They invested in moderns police cars and built new police stations. This way the police men had something to loose in case they were caught on bribing.
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| A Ford police car - it is the model many cities use also in the USA. Note the huge bumpers to kick cars off the street if necessary. |
- An extremely clever idea was to use receipts as lottery tickets. Every receipt contained a unique code on its backside which was the lottery code. Of course people wanted to have a chance to win millions and therefore insisted to get a receipt. With a receipt it was no longer possible to evade the value-added tax.
- The next step was the privatization of the power supply. 10 years ago it was normal that many people only had electricity for some hours a day. The reason was that people were not used to pay for things like electricity or water supply. It was cheaper to bribe people from the supply company. But of course it is impossible to repair the infrastructure if you don't get money from your customers. The new private companies have the duty to guarantee that there are no circuit breakdowns. If not, their concession expires. This prevents corruption because the private companies will fire corrupt persons otherwise they will loose their business.
I often heard that 10 years ago the situation in Georgia was like it is today in Armenia. After Georgia I went to Armenia as you will read soon and the situation there really sucks. I cannot image to live in such a corrupt country. With this background it is really incredible what the Georgians achieved! Saakashvili and his government made of course mistakes and it was the right democratic decision to elect someone else after 2 presidencies but it is also incredible what they achieved in such a short time. I got the impression that now, after about 2 years with the new government, many Georgians realize the achievement of the former Government. It is also interesting to see that the current Ukrainian government hired several former Georgian high-ranking officials like Alexander Kvitashvili and Saakashvili himself to force reforms.
All in all the Georgians now have a state and a society that attracts many companies from abroad to invest there. If the people manage to keep strong and suppress corruption also in future I think unemployment will decrease and the salaries will increase continuously.
Edit 1:
Just coming back from Romania, I noticed that there they are now using the same "lottery ticket is the receipt" system as they once did in Georgia. The locals told me that the government tried a lot to fight back tax evation of the value-added tax but first the lottery idea helped. Now everybody insists to get a receipt. An indeed you now get a receipt also in small shops selling refreshments.
Edit 2:
For the German readers of the blog: here is a short documentation about Georgia's progress during the last years.
