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May 30, 2006

Bribery as a Cost of Doing Business In Washington, DC

india_utl_backoffice_electronics.JPG

Your Business Blogger
with back office hardware
Bangalore, India
In India it's called "Speed Money." In Mexico it's call "Facilitation." In China it's called a "Relationship."

In the US of A, it's called a "Bribe."

Except in Washington, DC, where it's called "Love."

Frank Robinson, an Inspector for the Washington, DC Department of Transportation was caught on tape asking for love; asking for a bribe. According to The Washington Times, May 25, 2006:

Mr. Robinson: You want your permit right away, right?

Contractor: D*mn right I want my permit.

Mr. Robinson: You need to love me, baby, you need to love me. I did my part; you didn't get no fines or anything.

Contractor: Give me a price. I got to talk to my people about money. Tell me how much.

Mr. Robinson: What you think man? If you had somebody ...watch something so you didn't get a $2,500 ticket?

Contractor: Frank, I need a price.

Mr. Robinson: Give me $500.

Sounds much like doing business in a Third World Nation. Or maybe it is. As Washington, DC has often been compared.

Your Business Blogger once had a boss in the medical device business working the Washington, DC hospitals. He advised me on how to deliver "the gratuity" which was usually in a brown paper bag, to the key influencers and decision makers. My boss was a pro. He directed me to give the goods only after the contract was signed as a "reward." Rather than before the signed order.

The "thank you" was a box of donuts.

A difference of degree from $100K Congressman Jefferson received as a "gratuity" I suppose.

As Your Business Blogger consults with international clients, particular attention is paid to the difference between a gratuity and a gratuity.

And I would lecture smugly on the superiority of God-fearing English-speaking Capitalists (that'd be us) ruling the world.

(Test: Find something in your house made in China Syria.)

People always ask, "What is the main difference in business between USA and [country X]?

The short answer is that North America has trust as then central tenet of business. The Puritan Work Ethic. I would advise, discreetly, that Americans expect an honest deal. The rest of the world expects to get screwed.

Nobel laureate Milton Friedman spoke to this. He said that a cultural prerequisite of making money is the holding of truthfulness as a common virtue.

When you can trust a merchant's word, says Friedman, "it cut[s] down transaction costs."

The North American flavor of capitalism makes the most money and leaves the best taste. Even with an occasional rotten apple in Your Nation's Capital.

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Posted by Jack at May 30, 2006 01:04 PM

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Comments

Trust in business is not confined to the United States. In fact, trust in business is even more important in those countries with endemic corruption and poor legal systems.

Posted by: China Law Blog at June 4, 2006 03:07 PM

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