Good afternoon. My name is armando trull, Senior Reporter withwamufm, top ratednpr station in the country. I would like to welcome you to whats sure to be an exciting conversation about corruption in Central America, the United States, and elsewhere. I will be moderating this conversation and you will have an opportunity to ask questions once the panelists are finished. First, sarah chayes, a senior fellow here at the Carnegie Endowment for international peace, author of this report, one corruption is an operating system and using honduras as a case study. To add perspective to this conversation, Zephyr Teachout is a law professor at Fordham University school of law, the author of corruption in america and she is also an attorney on the emoluments lawsuit against president trump. So, corruption as an operating system. What does that mean . What yeah. What am i talking about . Exactly. Would you mind yeah. So we have a picture but fundamentally what im talking about here is not corruption as some nasty practices that some members of government indulge in in some countries, a lot of government officials might indulge in this. But, you know, the way we normally think about it is sort of like i dont know. Like a disease. Right . That kind of creeps in and infects the tissues of a government. What ive been seeing in honduras turns out to be a really clear example of it is a network, right . And a network that crosses boundaries that we think of as separating different sectors of activity, like the public and private sector. Right . Here we are americans. We love to fight about which one, the public or the private sector, is more pernicious. Right . Words for your health. And let alone the criminal sector. I mean, as we all know south america unfortunately is famous for criminal activity but what becomes clear when you look carefully is that youve got a network that is made up of people at the top of the Public Sector, the private sector and the criminal sector. And often they overlap or they share competencies or they have a cutout like a representative that theyll, you know, one brother will be in the Public Sector and the other brother will be running a drug cartel. So you you span these different sectors. And thats what this picture is supposed to at least, you know, evoke in peoples mind. And do want to just say ill say that later. But, david, if you wouldnt mind just giving me the next one. This info graphic does try to break it down for you so the Public Sector members of the network have a responsibility and that is to distort state agencies or institutions function function, functions of government, if you will, to serve the purposes of the network as opposed to serving their stated purpose which is the public interest. Public good. Exactly. The public good. And so im not going to go through them all but what the report does and info graphic does is pick them apart a little bit but there are obvious examples i have seen in honduras and a number of other countries and one of them is the Justice Sector because theres a bargain that holds these networks together and its that money flows upward in the network. And impunity flows downward. Theres a deal. You get for the part of the take that youre kicking upwards, you are guaranteed protection from legal repercussions and that can take a lot of forms in Different Countries. In honduras, its particularly egregious. You had a midnight firing of four of the five justices of the Supreme Court. You know . This happened a number of years ago. But it can be the actual judges, it can be by capturing public prosecution. In some countries, i havent seen it in honduras, but in some countries where its difficult to actually capture the Justice Sector, the network figures out how to work around it. So in egypt, for example, where judges did retain quite a bit of independence, president cisi has been focusing really hard on expanding the jurisdiction of the military courts. So that more and more cases can bypass the relatively independent civil system and be funneled through the much more controllable military system. Then the next thing, lets just look at the next one. So the colors on this infographic are blue for government, green for private sector because thats money. Right . At least to us. And red for criminal sector because thats bad guys except theyre all bad guys. Anyway, we looked at the private sector and its not the i mean, sometimes this can look like the entire system and you sort of say, whens corrupt . Everyones corrupt. You know . But it actually makes some sense to try to drill down and look at what are the specific Revenue Streams that are being captured by the networks . So some of it back to the Public Sector is public procurement. Thats another way that these networks and in honduras in particular infrastructure. Right . Big Infrastructure Projects like road building, ports, things like that. So youll see, you know, construction companies. But the Banking Sector is a classic n. This case, it trnls out that the network or network affiliated families control about half of the banking of the financial sector. Energy is a classic and in honduras its interesting because its not a country that has an extractive industry. Right in there isnt oil or gas. Its got a Mining Industry and so thats part of it but no oil or gas. So quite interestingly its been energy generation. Its been Electricity Generation that has been captured, including renewables. That was a big surprise. The Solar Energy Sector has been captured by this network and theyre getting sweetheart rates, very high rates. Palm oil also for biodiesel. A couple others, interesting ones, nonprofit organizations. Its one to keep ones eye on because one of the important Revenue Streams, of course, is International Development financing. And so, if you can situate yourself to capture that flow its a pretty significant one. And then, there is the criminal sector and i dont think i need to belabor that in the case of honduras but we have a case going on in new york right now, the former right . Son of the former president , is that who it is . I did want to ask you a question. Im not trying to deflect. No, no. Of course. What makes it an operating system opposed to just a bunch of crooked people . Thats a great question and it partly its you look at the personal relationships, so in this case, a piece of the private sector element is somewhat self contained an its culturally uniform to come extent. Its a lot of lot of people who are descendants of immigrant from the middle east and they tend to live together, intermarry, go to School Together and exchange positions on each others boards of directors. Thats that self containness is breaking apart a little bit in that were in the fourth generation but its the exchange of personnel and the clear whats the word i want to say . You know, you look at the people who are making decisions and you will see the same names popping up in the Decision Making processes and Decision Making bodies. And then as i say, the exchange of personnel so you will have this private sector group im talking about, they have had a number of top officials selectively appointed in at different stages. And then in the criminal sector, also, its youve got you can see its almost you have to do a social networking and i would have loved to have done enough of these personal linkages so that we would have another graph which would really be the social Network Diagram and i think that thats an important kind of avenue for further research on this topic. Whats the overriding goal of this system . Making money for network members. It really is revenue maximumization. Now, we can get into a conversation about whether its money or power and does money get you power or does power get. In this case and in general internationally, power is the means of that have been in other times and places. The reason i said that in the honduras case, the money people are bossing around the political people. The criminal who is have access to money are armed force are often bossing around the political people. So you mean there is no id ideoloidea ideology cal. Thats a whole conversation that we can have how money is displacing other, you know, like measures of social value in the period that we live in today. And how you make the money does not matter as much. And then just two last points i would love to make. All right, go. One is networks are more resilient than individuals. You see next door in guatemala where some of these individuals committing these practices have been removed from office and prosecuted. Thats not enough to uproot a network about this. We need to think about this as how we interact with this over seas as those who are involved in trying to affect policies towards other countries. These networks are, you know it is like a fishing net, you can cut one net out of the fishing net, that does not spoil the whole net so thats pretty significant and therefore we really have to think abou about and this was important in honduras of the positive organizations that people fighting against this, we Found Network and we can, you know, talk about that further. There are networks and theyre quite ballistic, they are single issue and this thing has infected a lot of the public stage and the effect are in multiples. So i think it is a good time to open up for questions, right . I am not disrespecting it in any way. Sarah, you have been sitting here patiently, what do you make of all this . What sarah is doing is really important. I want to put in a few frameworks. One is the framework of the last 30 year of Global Anticorruption fight. And anticorruption has drifte to the top of the global agenda. We put a lot of money and energy and resources in to anticorruption so it matters of what we mean when we say corruption. And, a few things have happened in the area, one particular strategies that might work. If you think about corruption as this sort of sideline problem and infection on an, otherwise, healthy body politics, that approach makes sense like we have this discreet problem in one area and we can fight it by a few laws here. What sarah is suggesting us the suggesti the not by looking at number of violations and number of prosecutions on a particular kind of bribery statues but rather when those in power, use that power for private ends as opposed to public ends. It change the lens to wh it c lens of how relowe look at thin. We start by asking are those in power using public power for selfi selfish ends or not. You start looking at power. One of the important things that sarah does is not say we look first at elected officials and secondarily of those who influence them. To do that, elected officials are those in court. You start with the default assumption ths that those getti elected and you look at who actually control things mattered. What shes doing then is h harpening back to understanding corruption. Aristotle has a sixtier system of government. There were three ideal form and three corrupted forms. The idea forms were the monarch, aristotle and quality and the corru ambassad corruptive form. It is not the number whos governing. It is the number who they serve. The monarch is publicly interested and the tyrant is out for his own. So you are describing is really incense is something closest to the rule or self interested, and this may sound like, you know, everybody understands aristotle, this is not the way we operate internationally now. We tend to operate by looking at particular crimes and stop those particular crimes. We can talk later about the trump administrations which is unique in its assaults on the rule of law and unique in disregard for any norms or laws, not any but norms and laws around corruption. Set aside donald trump, prior to this recent presidency, we have a growing split between elites and the rest of the country and especially dc elites. A split between what we think of is corrupt or not corrupt. There is an incredible capacity of political leads to understand and rationalize behavior as not corrupt because it is not illegal where as we talk to most people and most place in the country, they look at the way we find campaign. It is not just the way business is done but actually leading to those in power instead of republicans. I would like to jump in on that and ask sarah, one of the Points Police zephyr was making, by changing laws which used to be of a democracy and some what honest system becomes addict ta dictatorship. If you can talk about each of the sector and the sector you call enablers and how all those people according to working and do this to make this operating system reach its the legal questions are really interesting and i am going straight from honduras again for a second. One of the things that these networks lead where ever they are typically use to keep the population down if you will. Frankly, a u. S. Example that had my jaw on the ground was the eight to zero Supreme Court ruling last july that through tout corruption conviction of governor mcdonald of virginia in this area. I could not even swallowed if it had gone that way on a split ruling. It was the 80 part of it that really blew me away and the fact that nobody even thought to write, you know, like a concurrent opinion saying golly, okay, given the way the laws written, we had to vote this way but and a couple of buts pabt t about the patrons. Let me spell out why that conviction is thrown out. It was thrown out not this was one. It was the definition of what an official act is. So the guy had set up meetings for his business benefactors, he had set up meetings and using his telephones and things like that. An official act was being defined ever more narrowly to the point that it seems for something to be considered corrupted in this country, you need to sign a contract. At least from virginia. No, this is the United States. Was the ruling based on the virginia law. U. S. Laws, right . This is a matter of u. S. Law and just to under line sarahs talking about, we have a Supreme Court who has navorrrow the definition of corruption in two distinct areas, the laws that make corruption most likely, Citizens United. Like the upstream laws, the laws that upstream of an act being committed would prevent the serious of events that would make corruption likely. And so in those case what is the court says is we dont need these laws because we have bribery laws to deal with boundaries. We can deal with the real problems and the bribery case which the court is narrowing the definition of corruption and making it harder for prosecutors to bring cases as in the mcdonalds case so you have this device coming in and the only thing thats left is basically, it is really so you know armon goes in office. Please dont use me. We are going to sign a contract, i am going to give you 500,000 tla 500,000 and you have to sign a contract. This never happens. But i think that relates to honestly to sort of an elite and cultural approach that the Supreme Court sees people like governor mcdonald as part of a community that they recognize and understand. Does this sense of we are entitled that . Mark twain who you can go to almost anything writes about this in his novel, the gilded age is the two different languages of corruption that happen in the late 1920 century where elites start to say hey, this is not really corrupt, this is the way we do things. And everybody else says he walks like a duck and talks like a duck, it is a duck. In honduras it is quite clear of the legalization process. A building is not a dignified building. Its ability to serve and over sight functions have been systemically under mind and meaning just physically the space when i wanted to meet with members in congress, they did not have offices. They did not have Conference Rooms. There are two Conference Room in the building of congress. They have to camp out in the building to prevent anyone else from taking some people may say it is a good thing, i mean. Just in terms of how you can conduct your business. Okay then what we were able to do was catalog just a series of laws that all cut the same way essentially legalizing in zephyrs term. For example, they create something called the counsel for Public Private partnership. It serves to move public money off budget for Public Private partnership on Infrastructure Project that the money is held in at trust by a bank and it is forever not subjected to the public procurement law. It is a way of essentially disabling governments ability to perform its function in the publics interest. Secrecy laws that increase the ability to hide all of these types of practices and i mean secrecy laws, it is again under the cover of National Security but there are also bodies that you would not think ought to be covered by National Security secrecy law like the Supreme Court. All proceedings are covered by a classification system that you know you would normally assume would be controlled by the military and you also have had the creation of a National Security counsel that confuses again a lot of what you normally think of separation of power so you got the Justice Sector and the president of the Supreme Court and the attorney general and the army, the interior ministry and the president o