NCJ Number
63817
Journal
Foreign Affairs Volume: 54 Issue: 4 Dated: (JULY 1976) Pages: 719-733
Date Published
1976
Length
15 pages
Annotation
THIS PAPER ATTEMPTS TO CLARIFY THE CONFUSION AND EMOTIONALISM CONNECTED WITH THE DISCLOSURE OF AMERICAN CORPORATE BRIBERY ABROAD, AND ADVOCATES THE PASSAGE OF CLEAR LEGISLATION DEFINING ILLEGAL PRACTICES.
Abstract
IN A POST-WATERGATE CLIMATE OF PITILESS EXPOSURE, SUSPECT AMERICAN BUSINESS PRACTICES ABROAD HAVE RECEIVED INVESTIGATIVE ATTENTION FROM A VARIETY OF GOVERNMENT AGENCIES AND THE MEDIA, RESULTING IN OVERSIMPLIFICATION OF COMPLEX ISSUES. SHARING THE BLAME SHOULD BE LAWYERS, ACCOUNTANTS, FOREIGN GOVERNMENTS, U.S. POLITICIANS, DOMESTIC GOVERNMENT AGENCIES, AND AMERICAN FOREIGN CORRESPONDENTS, SINCE THEY ALL KNEW OF AND TOLERATED PRACTICES WHICH ARE NOW SWEEPINGLY CONDEMNED. MOREOVER, NOT ALL PAYMENTS MADE TO FOREIGN GOVERNMENT OFFICIALS SHOULD BE JUDGED ALIKE, SINCE MANY FORMS OF PAYMENT UNDER ATTACK DO NOT CONSTITUTE BRIBERY UNDER THE ACCEPTED LEGAL DEFINITION. THE REAL PROBLEM IS THAT CORPORATIONS ARE STILL ENGAGED IN PRACTICES WHICH ARE ILLEGAL, UNETHICAL, UNBUSINESSLIKE, AND ULTIMATELY HARMFUL TO THE U.S. IMAGE AND INTERESTS ABROAD. UNFORTUNATELY, THE STATE DEPARTMENT AND AMERICAN EMBASSIES, WHILE KNOWING OF THESE PRACTICES, HAVE FAILED TO PROTECT HONEST BUSINESSMEN AND WARN OTHERS OF WHAT CONSTITUTES ILLICIT PAYMENTS. COMPLICITY OF THE DEFENSE DEPARTMENT IS EVEN GREATER, SINCE IN QUADRUPLING THE SALE OF U.S. ARMS ABROAD OVER THE PAST DECADE, THE DEPARTMENT HAS APPROVED CONTRACTS FINANCED BY MILITARY ASSISTANCE FUNDS WITHOUT EXAMINING AGENTS' FEES AND OTHER SUSPECT CONTRACT TERMS. THESE WASTEFUL, CORROSIVE, AND INDEFENSIBLE PAYMENTS TO FOREIGN OFFICIALS SHOULD BE HALTED, EVEN THOUGH BUSINESS LOSSES WILL SURELY RESULT. INSTEAD OF IMPOSING AMERICAN ETHICS ON OTHERS, THE LAW SHOULD REQUIRE CORPORATIONS BASED IN THE U.S. TO ADHERE TO A STANDARD THAT SERVES THE NATIONAL INTEREST. AWAITING THE DEVELOPMENT OF INTERNATIONAL CODES WOULD BE AN EXCUSE FOR INACTION. DISCLOSURE LAWS MUST BE STRENGTHENED TO INCLUDE CRIMINAL AS WELL AS CIVIL PENALTIES AND PROHIBIT CONCEALMENT TECHNIQUES IN ACCOUNTING PRACTICES. A NEW LAW SHOULD OUTLAW PAYMENT OF BRIBES TO FOREIGN OFFICIALS BY U.S. CORPORATIONS AND REGULATE THEIR USE OF AGENTS. THE EXECUTIVE BRANCH SHOULD BE EMPOWERED TO TERMINATE VIOLATOR ELIGIBILITY FOR GOVERNMENT CONTRACTS, AND U.S. EMBASSIES SHOULD BE ABLE TO PROTEST IF IMPROPER PAYMENTS ARE REQUESTED OF AMERICAN BUSINESSMEN ABROAD. FOREIGN COUNTRIES AND COMPANIES PERSISTING IN SUCH PRACTICES SHOULD BE WARNED OF THE POSSIBILITY OF U.S. ECONOMIC RETALIATION. SUCH LAWS SHOULD BE ACCOMPANIED BY INCREASED DEMONSTRATION OF CORPORATE SELF-REGULATION. FOOTNOTES ARE INCLUDED. (MRK)