Part I: Governance and institutions have

now become important in Sri Lanka

The proliferation of much-hated bribery and corruption directly

relates to the presence of a big government

Monday, 31 August 2015

Governance and institutional framework go hand
in hand
A new Government promising the delivery of good
governance to citizens has now been voted to power in
Sri Lanka. With that development, governance issues
have become all the more important in the country
today. But governance cannot be delivered without
supporting institutions. Hence, as an integral part of the
new system to be implemented in the country,
institutional building should go hand-in-hand with
governance measures.
Governance is nothing but an ethical and moral
code
Governance refers to how an individual relates himself to
societys ethical and moral code. Individuals are, by
nature, selfish creatures and, therefore, it is difficult to
expect selfish individuals to subscribe to a moral and
ethical code when it conflicts with their private desires.
Their genetic landscape, as argued by the Oxford
Universitys ex-evolutionary biologist Richard Dawkins in
his The Selfish Gene, is both wired and made up for their

own survival and protection. Hence, the prime objective of individuals is to

work for selfinterest and ensure survival, sustenance and well-being.
Governance factors, though they benefit from them, become secondary to
their private goals.
Problem arises when the moral and ethical code conflicts with
personal desires
When the moral and ethical code of a society is at variance with the
individual self-seeking, there arises a conflict and that conflict gives rise to
the need for a governance code. The reference that we often hear as good
governance or bad governance is, in fact, made in relation to the
divergence of the personal behaviour from the governance code.
What it means is that, if there is no difference between the moral and
ethical code of the society and the uncontrolled self-seeking behaviour of
individuals, then, there is no meaning in talking about good governance or
bad governance.
In a society of robbers and cheaters, good governance is robbing
and cheating
This can be illustrated by considering a hypothetical case. Suppose that the
society upholds robbery as its moral and ethical foundation. In this society,
those who rob others are hailed and those who refuse to rob are jailed.
What is the cherished principle of governance in this society? It is nothing
but robbery and cheating at every human transaction. So, everyone is
taught to rob and cheat others. The person who makes the biggest robbery
(or equivalently, does the gravest cheating) is hailed by all as their super
hero.
Since non-robbers have no place in this society, it becomes necessary for
everyone to become a robber or a cheater. Thus, robbers and cheaters will
drive out all the good people and, eventually, the society will be made up
exclusively of people of the former category. Good governance in this
society is simply what people will do to rob or cheat the fellow citizens. By
the same analogy, bad governance occurs when they do not rob or cheat.
The governance code of Sri Lankas road users is robbing from
others
Sri Lankas road ethics provide a good example of a society of robbers. In
the use of roads, everyone has an entitlement called the right to use a
given space of the road for reaching his planned destination. Economists
call it the assignment of property rights to road users. But, what can we
observe on Sri Lankan roads? All those who use roads, whether they are
pedestrians, push-cyclists, motor cyclists, three wheel riders or motorists, it
does not matter, are inclined to rob the property rights of others freely and

openly.
How do they do it? Pedestrians cross the roads at all places except the
zebra crossings forcing motorists to apply brakes abruptly. Drivers of all
sorts of vehicles do zig-zag driving without consideration for the motorist
behind. In the night, drivers with powerful head lamps drive their vehicles
with head lights on even in the well lighted city streets, thereby robbing the
vision of the motorists coming from the opposite direction.
Very often, the law enforcement officers who are expected to prevent such
violations simply keep on watching such acts of robbery passively, as if
robbery is the accepted norm of using roads. Those who do not rob the
property rights of others cannot reach their destinations and, hence, they
too have to violate the property right entitlements of others.
If one meets with an accident due to the negligence of another, the
innocent party is penalised (jailed in our society of robbers) by requiring
him to bear the cost of the accident out of his insurance entitlement and
thereby forgo his no-claim bonus. The perpetrator of the accident thus goes
scotch free.
Essential features of an ethical and moral code of good governance
For us to talk about good governance in a given society, its ethical and
moral code should necessarily uphold and honour the following: the
recognition of the rights of others; fair play in dealings; freedom of thought
and expression; toleration of opposing views; peaceful resolution of
conflicts and disputes and open and free debates over unsorted issues with
a view to finding a lasting and amicable settlement.
Governance is thus a way of life of a large segment of the members of a
society. It is a self-discipline and an ethical and moral code which people
have inbuilt in themselves. It is also a peaceful and amicable way to resolve
the conflict between private self- interests and societys common interests
without injuring the psyche and the intellectual build-up of individuals.
When followed by everybody in terms of its spirit and not as a mere lip
serving, it contributes to the mutual benefit of all those in a society.
Kautilyas prescription: Dont give uncontrolled discretionary
power to anyone
A code of governance is specifically relevant to those who have enormous
discretionary powers, whether they are in the State sector or in the private
sector, over the affairs and the lives of others. That is because any unfair
treatment by such powers will cause an irremediable injury to their victims.
To prevent such powers from using their discretions haphazardly and
unjustly, they should necessarily have an inbuilt code of moral conduct to
observe at all times.
Kautilya the 4th century BCE economics Guru in his treatise on economics,

The Arthashastra, observed that an ideal king is the one who has the
highest qualities of leadership, intellect, energy and personal attributes. As
regards personal attributes, an ideal king should be eloquent, bold and
endowed with a sharp intellect, a strong memory and a keen mind. He
should be amenable to guidance and be just in rewarding and punishing. He
should preserve dignity at all times and not laugh in an undignified manner.
He should be sweet in speech, look straight at people and avoid frowning.
He should eschew passion, anger, greed, obstinacy, fickleness and
backbiting. He should conduct himself in accordance with the advice of the
elders. So, the weaker is protected only if the powerful follow a well defined
moral and ethical code of governance.
Sage Damdamis to Alexander the Great: Dont instil fear in others
if you desire love and respect

What Kautilya has highlighted as the self-discipline which those

with powers should have cultivated when conducting towards
the weak has been amplified a century ago by Sage Dandamis
in an answer to a question posed to him by Emperor Alexander
the Great. As reported by historian Plutarch, Alexander, having
been impressed by the way Sage Dandamis resolved many
difficult riddles thrown at him, is reported to have asked a final
question from Dandamis. How can one make oneself loved and
respected? Alexander had asked.
Dandamis answer had been straight and to the point: If you
have enormous powers, but, if you do not instil fear in others,
you are loved and respected. A modern ruler who has inflicted
fear in his citizens would have sought to overcome the issue by
staging a massive propaganda campaign to show that he is
being loved by people. Such moves are self-defeating because people do
not have real love for him and they are simply the products of his
propaganda machinery.
But Alexander the Great, being a wise man, took the answer differently. It is
said that Dandamis wise counsel had opened the eyes of the Great Warrior.
What have I attained through my ruthless and brutal military expeditions?
He is said to have questioned himself. By inflicting fear in others, he is now
the most hated person on the earth, not only by the people whom he had
subjugated, but also by his own army. This answer had caused Alexander to
end his military campaign and turn back.
Buddhas Noble Eightfold Path is a code of good governance

It is, therefore, important for people with power to design a way how they
should conduct toward the others. Two centuries before Kautilya, the
Buddha had the prescription. If you do not wish to be treated in a certain
way, do not treat the others in the same way the Buddha had preached.
We do not wish to be unfairly treated, robbed, harmed or abused, denied of
opportunities and deprived of our freedom. If we do not like them, then, our
governance code should be such that we do not inflict the same on others
as well. The adherence to such a code calls upon us to develop an innate
culture in us by inculcating self-discipline, making a self-inquiry, exercising
self-restraint and attaining self-realisation. How to develop such an innate
culture was preached by the Buddha in terms of the Noble Eightfold Path to
be followed by adherents.
It requires an adherent to have right view on the matters in the real world,
form right conception of real world phenomena, engage in right speech,
make right efforts, earn living through right livelihood, practise right
behaviour, have right mindfulness and be in right concentration. It is
important to follow the spirit of Noble Eightfold Path, and not merely its
letter, in order to cultivate the required innate discipline in oneself.
Real danger is reducing governance principles to mere textbook
words
However, the real world experience is that not everyone in society could
develop the innate culture in its true form. In such cases, the majority,
openly flouting the governance principles, may reduce them to just words
written in texts and not cherished dictums that are being followed. It, then,
leads to the proliferation of a society of robbers with all its unfavourable
consequences which we have noted earlier. In such a society of robbers,
everyone simply pays lip service to governance principles but, in reality,
behaves in manners contrary to the ethical and moral code of the society.
To prevent society from becoming a society of robbers, it is necessary to
introduce governance principles as requirements from outside and promote
institutions, both government and voluntary, to oversee that such principles
are being adhered to.
Institutions are ethics, values and beliefs of people
Institutions in economics are not merely the organisations that function in a
society. They are simply the ethics, values and beliefs of the members of
society. These are also known as ideals of the people. When such ideals are
collectively represented under coordinated umbrellas, they are called
organisations. Such organisations representing the initiatives of people are
known as civic society institutions. Empowering such civic society
institutions is a must for any society to ensure that society follows the good
governance principles.

Civic society institutions should name and shame perpetrators

Institutions act as a deterrent to the pursuit of uncontrolled self-interest
goals by individuals, help maintain law and order and observe the rule of
law, ensure righteousness and transparency in public dealings, protect the
rights of people to hold property, uphold freedom of thought and
expression, impose effective checks and balances over the exercise of
powers, penalise the violators and abusers of governance code and prevent
the incidence of bribery and corrupt practices. While the social institutions
should name and shame the perpetrators, the legal bodies should pass
penalties on them.
A nation cant rob from itself and become prosperous
Bribery and corruption has been considered a social evil, though in strict
economic terms, they help an economy to function smoothly by oiling the
unmoving cog wheels of discretionary decision making processes. Yet, an
economy-wide proliferation of bribery and corruption will become an
economic evil too, when everyone in the society tries to make easy money
through such practices (in economists parlance, rent-seeking), leaving hard
and honest work which is the prime and sustainable source of wealth
creation. At individual level, a person may rob from another person and
make a living.
But, at national level, a nation cannot rob from itself and become
prosperous. Hence, all societies have been concerned about the ill effects of
bribery and corruption and taken action to put a stop to them so as to
promote sustainable economic prosperity.
Limit the opportunities for bribery and corruption
Kautilya in The Arthashastra has advised the king to limit the opportunities
for state officials and ministers to engage in bribery and corruption, while
prescribing the severest punishments to miscreants. He has observed that
it is a natural temptation of people to misuse or rob the moneys placed in
their disposal by others. He said, it is impossible not to taste honey or
poison at the tip of ones tongue and so it is impossible for one dealing with
public funds not to taste a little bit.
The predicament of the king in this case is his inability to apprehend the
miscreants. So, Kautilya said that it is impossible to know when a fish
moving in water is drinking it and, so, it is impossible to find out when
public servants misappropriate money.
Small government is one solution for a society to check on bribery
and corruption

The solution is, therefore, to place only the minimum quantity of honey on
the tip of those who have to deal with public funds. That again should be
done only in unavoidable cases.
To do so, one should have the smallest government possible. This is
because the proliferation of much-hated bribery and corruption directly
relates to the presence of a big government.
(W.A. Wijewardena, a former Deputy Governor of the Central Bank
of Sri Lanka, could be reached at waw1949@gmail.com.)
- See more at: http://www.ft.lk/article/464299/Part-I--Governance-andinstitutions-have-now-become-important-in-Sri-Lanka#sthash.Src6atjn.dpuf
Posted by Thavam