Now seems a good time the explain the analysis behind this iron law.
Yesterday, the UN appointed Zimbabwe, a country being starved by its dictator, to chair its Commission on Sustainable Development, and the World Health Organization excluded Taiwan, the country with the world’s second best healthcare services. Not to mention Terror’s Bankers.
Here, based on experience, is how these international institutions get to be so dirty.
1. Most Nations Are Corrupt Dictatorships
You can work out how an organization should behave by deriving an average of the appropriate measure. That average will depend on the voting used – if it’s one nation, one vote (e.g. UN General Assembly), you take the mean. If it’s population-weighted (like some EU decision making), you just weight for population. If only some nations get to vote (like the UN Security Council), you just include them.
That makes the UN General Assembly as honest as El Salvador, its Security Council as honest as Bahrain, and the EU as honest as Uruguay. The averages for economic and personal freedom are equally ugly.
But it’s much worse than these numbers suggest because of three additional effects.
2. The Mandelson Effect
We name this after the Brit EU Commissioner who was forced to leave national politics and join the EU. Naming the effect after him is a bit unfair, since the scandals were trivial by the standards of most EU members.
This effect is general – the current Prime Minister of Italy, who has a past that’s murky even by Italian standards, dived into the EU when things got too hot at home.
And Cyprus, which is fairly honest by Mediterranean standards (same CPI as Botswana), has nevertheless provided world-class rogues ranging from the UN guy who ran the Saddam’s Palaces for Oil fraud, to the EU team that forced the Brits to shutter a specific company that they considered disrespectful.
You can see this effect in business. If a company joins an industry body, who does it send to represent it? Certainly not the smartest and most efficient – they’re needed to keep the business going. So the choose the guy (or gal) that nobody has any use for.
And since politicians are measured by public acceptance, not competence, the crooks get sent to the international organizations.
This means that the actual representatives are more corrupt and incompetent than the nations they come from.
3. The Despotism Effect
Every international organization has a secretariat (e.g. the UN Secretariat) and an oversight committee (e.g. the UN General Assembly).
In practice, the secretariat is more powerful than the overseers. tha’s because the secretariat is full time, and because it can do favors for individual overseers.
So these organizations rapidly turn into a mutual benefit organization – that’s why the overseers of the EU don’t care that its accounts have been qualified for each of the past for 11 years.
And that’s why the secretariat turns into a typical state organization – lazy, customer-phobic, and with total job security.
The big difference however is the compensation is much better in an international bureaucracy – hence the 13% of World Bank employees earning more that SecState. Plus they get paid tax free, and don’t pay parking tickets.
It’s why if you fly BA First Class from Heathrow to NYC, you’ll be surrounded by Savile-Row suited chaps from poor African countries headed back to the UN after “consultations” at Harrods.
4 . The Corrupt Leadership Bias
Getting to the top of a corrupt organization requires first-rate skills in negotiation, bribery, and corruption – and so the worst man wins.
Hence the awful Annan, and the EU President from the very recently democratized and (by Brit standards) corrupt Portugal.
As with any organization, the leader sets the tone – if he acts like a crook, so does everybody else.
These four factors can be combined as follows:
- Take the average corruption (CPI score) for all members
- Subtract 1.0 to allow for the Mandelson Effect
- Subtract 1.0 to allow for the Despotism Effect
- Subtract 0.5 to allow for the Corrupt Leadership Bias.
(This is quite a mild correction – the UK is 1.0 less corrupt than doughty Japan, and 0.6 less corrupt than supposedly honest Germany)
That makes the UN as trustworthy as Haiti, and the EU as corrupt as Hezbollah’s Lebanon.
Now you know why the World Bank finances terror; why the UN excludes Taiwan, demonizes Israel, and wants to de-industrialize the US; and why the EU undermines the Israelis and Brits.