Crime and Corruption | Page 4

despite
incontrovertible evidence to the contrary, the unfazed premier denied
that his president possesses multi-million dollar bank accounts abroad.
He later rescinded this last bit of disinformation. The president, he said,
has no bank accounts abroad but will promptly return all the money in
these non-existent accounts to Kazakhstan. These vehemently denied
accounts, he speculated, were set up by the president's adversaries "for
the purpose of compromising his name". On April 15, even the docile
opposition had enough of this fuzzy logic. They established a People
Oil's Fund to monitor, henceforth, the regime's financial shenanigans.

By their calculations less than 7 percent of the income from the sale of
hydrocarbon fuels (c. $4-5 billion annually) make it to the national
budget.

Slush funds infect every corner of the globe, not only the more obscure
and venal ones. Every secret service - from the Mossad to the CIA -
operates outside the stated state budget. Slush funds are used to launder
money, shower cronies with patronage, and bribe decision makers. In
some countries, setting them up is a criminal offense, as per the 1990
Convention on Laundering, Search, Seizure, and Confiscation of the
Proceeds from Crime. Other jurisdictions are more forgiving. The
Catholic Bishops Conference of Papua New Guinea and the Solomon
Islands issued a press release November last in which it welcomed the
government's plans to abolish slush funds. They described the
poisonous effect of this practice: "With a few notable exceptions, the
practice of directing funds through politicians to district projects has
been disastrous. It has created an atmosphere in which corruption is
thought to have flourished. It has reduced the responsibility of public
servants, without reducing their numbers or costs. It has been used to
confuse people into believing public funds are the "property" of
individual members rather than the property of the people, honestly and
fairly administered by the servants of the people. The concept of
'slush-funds' has resulted in well-documented inefficiencies and failures.
There were even accusations made that funds were withheld from
certain members as a way of forcing them into submission. It seems
that the era of the 'slush funds' has been a shameful period." But even is
the most orderly and lawful administration, funds are liable to be
mislaid. "The Economist" reported recently about a $10 billion
class-action suit filed by native-Americans against the US government.
The funds, supposed to be managed in trust since 1880 on behalf of
half a million beneficiaries, were "either lost or stolen" according to
officials. Rob Gordon, the Director of the National Wilderness Institute
accused "The US Interior Department (of) looting the special funds that
were established to pay for wildlife conservation and squandering the
money instead on questionable administrative expenses, slush funds
and employee moving expenses". Charles Griffin, the Deputy Director
of the Heritage Foundation's Government Integrity Project, charges:

"The federal budget provides numerous slush funds that can be used to
subsidize the lobbying and political activities of special- interest
groups." On his list of "Top Ten Federal Programs That Actively
Subsidize Politics and Lobbying" are: AmeriCorps, Senior Community
Service Employment Program, Legal Services Corporation, Title X
Family Planning, National Endowment for the Humanities, Market
Promotion Program, Senior Environmental Employment Program,
Superfund Worker Training, HHS Discretionary Aging Projects,
Telecomm. & Info. Infrastructure Assistance. These federal funds alone
total $1.8 billion.

"Next" and "China Times" - later joined by "The Washington Post" -
accused the former Taiwanese president, Lee Teng-hui, of forming a
$100 million overseas slush fund intended to finance the gathering of
information, influence-peddling, and propaganda operations. Taiwan
footed the bills trips by Congressional aides and funded academic
research and think tank conferences. High ranking Japanese officials,
among others, may have received payments through this stealthy venue.
Lee is alleged to have drawn $100,000 from the secret account in
February 1999. The money was used to pay for the studies of a former
Japanese Vice-Defense Minister Masahiro Akiyama's at Harvard.
Ryutaro Hashimoto, the former Japanese prime minister, was
implicated as a beneficiary of the fund. So were the prestigious
lobbying firm, Cassidy and Associates and assorted assistant secretaries
in the Bush administration. Carl Ford, Jr., currently assistant secretary
of state for intelligence and research, worked for Cassidy during the
relevant period and often visited Taiwan. James Kelly, assistant
secretary of state for East Asian and Pacific Affairs enjoyed the
Taiwanese largesse as well. Both are in charge of crafting America's
policy on Taiwan. John Bolton, undersecretary of state for arms control
and international security, admitted, during his confirmation hearings,
to having received $30,000 to cover the costs of writing 3 research
papers. The Taiwanese government has yet to deny the news stories. A
Japanese foreign ministry official used slush fund money to finance the
extra-marital activities of himself and many of his colleagues - often