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The Price of Coffee

The price of coffee has received some attention from economists but at the producers’ end it is not a question of economics; it is a political issue.
(Perhaps all economics is political). At the consumers’ end it is too insignificant to be a political issue and is of interest to economists because it resembles a case study from a textbook (one of theirs). There are more interesting issues.

Consider bribery. Here in Ireland it is a crime. ((on paper, but under reported)) In Kenya it can become a necessary way of life.

After all, what is an ordinary person to do in a society where an authoritative source can distinguish “… between the petty corruption of bribery among minor officials, grand corruption at senior ranks, and “looting” – scams of such a scale that they have macroeconomic impact”
One answer is; keep your head down. When the political pressure grows it may drive the looters to seek people of whom an example may be made. If this happens, hire a lawyer from a nearby jurisdiction (if possible). Even that may not be enough; anecdotal evidence ((gossip)) tells me of a case in India: the Plaintiff slipped the judge 5,000 currency. The judge read his judgment (recorded by a stenographer) in favour of the Defendant. As he looked down at the chagrined Plaintiff he raised five fingers and gestured towards the Plaintiff, then, raising ten figures, he gestured towards the Defendant and shrugged before leaving the bench.

Of course, everybody in the system will find they are paying bribes as well as receiving bribes. The Kenyan Bribery Index estimates that the payment of bribes accounts for one third of an ordinary person’s monthly income.

Transparency International defines corruption as “the misuse of entrusted power for private gain”. One Kenyan commentator refers to the formation of new networks in response to the focus on corruption.

The Ford Motor car cartel in Ireland was just such a network.
The existence of a network is an indication of potential corruption; the major actor, on any occasion, in the network may not be the major beneficiary (on the particular occasion; but what comes around goes around).

Why has the Government stalled on the Whistleblowers Bill since 1992?
Whatever chance we might have of getting information from within the networks if the Bill is enacted, we have none if the Government blocks it.

What does a network look like? Well, Teddy Roosevelt had some idea; he said “A man who never graduated from school might steal from a freight car. But a man who attends college and graduates as a lawyer might steal the whole railroad.”

Judge Moriarty is right to see Charles Haughey’s activities as the corruption of Irish democracy.