How endemic is German corruption? - Europe's crooks trample on legality

The rise of German economic corruption appears to have two phases. From the turn of the new century to 2012 / 2015 low level economic corruption became endemic throughout Germany as German manufacturing and industry expanded output and sales. A change in German law in 1997 had allowed prosecutors to investigate corruption proactively - previously firms had to report themselves. However, authorities were also then starved of resources to investigate and bring corruption actions - in effect giving official German government approval to allow corruption to flourish. As a consequence of this official 'fair wind', industrial giant Siemens distributed over €400,000,000 of bribe money to secure bent deals around the world.

As the New York Times reported in 2007:

Wolfgang Schaupensteiner has never been so busy. From an office in central Frankfurt that is decorated with cartoons about corruption, Schaupensteiner has headed the tiny financial crime unit for this city, Germany's financial capital, since 1993. These days, his backlog of bribery, fraud and other white-collar crime cases runs into the hundreds, and he says he has a simple explanation for it.

Corporate profits have surged across sectors ranging from finance to autos to energy, as German executives have turned the country into one of the world's largest exporters over the last five years. Illicit dealings helped create their success, he asserts, and that in turn has encouraged many executives to believe that crime does pay.

On Wednesday, prosecutors in the southern city of Nuremburg raided multiple locations of the offices of Siemens, one of the country's most prominent companies, on suspicion that certain bribes may have been concealed as payments for services that were never provided. In recent months, DaimlerChrysler, BMW and Volkswagen have also been raided, put under investigation or even had employees taken into custody. "Globalization has become a motor for corruption in Germany," asserted Schaupensteiner, 58. "It creates dangerous potential if you do not control it."

More recently, in 2017 Ernst & Young investigated the extent to which corruption has become embedded and institutionalised within the German economy. This second phase roll out of German corruption proved as insidious as an invasion of Japanese knotweed, with crooked tentacles reaching into every crevice of German economic life. The rapid growth of online trading in Germany in the last five years has exacerbated the criminality - German firms trade corruptly and criminally with impunity on the internet as the German legal system provides few affordable remedies for their victims. And all this is done with the complicity and support of the German government.

A staggering 43 percent of German business executives polled by EY (formerly Ernst & Young) think bribery and corruption are fairly commonplace in Europe's economic powerhouse. That's a big jump from just 26 percent in 2015.

In Germany, 23 percent of the managers polled admit they would act in an "unethical manner" to move up the career ladder or secure higher salaries. Roughly 10 percent of German executives polled wouldn't rule out deliberately providing false information to others to help their own careers and fill their pockets.

"VW's emissions-cheating scam, the Libor rate-rigging scandal, and [unlawful] collusion among companies as well as a raft of compliance violations have made the headlines quite frequently of late," says Stefan Heissner, who heads EY's Fraud Investigation & Dispute Services division.

He adds that stricter compliance rules that have appeared in the wake of major corporate scandals have not really changed the perception of widespread corruption in Germany.

Whilst Germany is not alone in seeing a rise in economic corruption, the country is unique in being able to roll it out on an pan European industrial scale, leading an entire continent in implementing then covering up emissions testing, and now corrupting the trade in two-thirds of the continent's gas imports. The corrupt appointment of the German zealot Martin Selmayr to the heart of the EU raises suspicion that the repression of the truth and blocking of all measures to tackle corruption has begun with a German takeover of key appointments. Germany's scoring on independent international indices was summarised by a correspondent in response to the post below; 

Unlike the EU the UK does not attack commercial competitors using the legal system: the EU attacks companies like Intel, Google/Alphabet, Microsoft, Amazon, Chrysler, Fox, Facebook, Starbucks, Apple, Sony et al by using antitrust charges to further the interests of Eurozone technology companies.

Circa 2016 - in terms of shareholder protection the UK is 4th in the world behind Hong Kong, New Zealand and Singapore: France is 29th: Germany is 49th.

In terms of creditor protection: Germany is 28th: France is 79th.

No other EU country can match the UK on Rule of Law: the UK is 3rd in the world for property rights protection: 2nd in the world for Investment Freedom: 3rd in the world for Financial Freedom. As The Wall Street Journal’s Jon Sindreu has noted: “most international financial contracts are written in English law.”

The World Ranking of Judicial Independence cites: UK 6th - Rwanda is 23rd, Germany 24th, France 28th, Saudi Arabia 30th, India 53rd, Spain 58th and Italy 65th.

The EU is like Volkswagen writ large: when they can’t hack it – they crook.

This deep and endogenous German economic corruption will not play well in the rest of Europe. The UK, the Netherlands and the Scandinavian nations, with low levels of corruption and high scoring of commercial rectitude and probity, will be feeling fouled by contact with German corruption - and will now be adding up the commercial losses that German crookedness has cost them. The southern nations will be aggrieved that they have been bullied, coerced and hectored by a deeply crooked nation wearing a false disguise of moral superiority. And eastern nations such as Poland and Bulgaria, countries Germany has robbed of billions of Euros in corrupt complicity with Gazprom, will be looking at concrete measures to get their money back.

Frankfurt may attract a few McMafia Russian banks, a BCCI or a handful of Ponzi scammers, but chances now that any reputable international financial institution would want to be mired in the filth of institutional German economic corruption are slimmer than ever.

German corruption will rot the whole EU fish

Fish they say rots from the head. The Telegraph details an explosive leak of documents (£) from the EU itself detailing EU collusion in illegal Gazprom trade terms - the analysis of which I'll leave to our valued and wise colleagues over at Capitalists at Work - it emerges that Germany enjoyed Russian gas at up to half the cost of her poorer neighbours, and it's suggested that this sweetheart deal kept a lid on the whole corrupt and secretive arrangements for so long, arrangements that beggared Germany's neighbours. It also helps explain Germany absenting herself from both European and international sanctions and other measures against Russia.

Institutionalised German corruption is a new idea. Those of us who've always thought of Germans as upright rule-followers obsessed with their stools may have to revise our opinion of them to Italians with a savings habit. The Volkswagen emissions scandal - again, a German leading role given the scale and value of German car production - was also known about throughout Brussels. But we've always known that the EU is irredeemably corrupt. And Martin Selmayr, the Federast High Priest, most recently appointed corruptly as head of the EU's civil service giving the corrupt Germans one of their own at the heart of the EU. 

Germany scores low on international indices of commercial rectitude. Her courts are corrupted and she scores lower than many second-world nations on WEF indices. But the main problem with German corruption is that they're so damn efficient at it on such a large scale - they've industrialised it. An entire continent's car production, an entire continent's gas consumption, both fouled by deep rooted and well-organised national corruption. And no, the French or the Spanish or the Italians would not have done it if Germany hadn't cheated and manufactured a cover up. 

That Germany's corruption is known and supported not only by the German government but by the whole EU is evidenced by the utter absence of criminal actions flowing from the diesel scam. This was not a victimless crime. Whatever the rights and wrongs of the emission standards, the facts are that car makers lied and cheated and as a consequence millions of diesel owners have effectively lost money - in some cases many thousands. So far the only car executive to face jail time is a German Volkswagen VP who failed to escape from the US in time. 

The EU has only one member that comes close to the UK in terms of low corruption, business rectitude, judicial independence and other Transparency and WEF criteria and that's the Netherlands; in many cases they score better than the UK. No surprise. The Dutch have long been both valued and admired as allies and rivals. Fish rots from the head, and the EU's uncontested head right now is Germany. If German corruption and hegemony is unchallenged, the EU will putresce. However, if a combination of the Netherlands and the Visegrad group move to wrest power from a sclerotic and corrupt Franco-German grasp, the UK may enjoy the benefits post-Brexit of a reformed Europe.  

Are the bastards lying to us again?

The British public is getting used to being lied to. Blair destroyed the credibility of the intelligence services, the BBC destroyed the credibility of national broadcasters and MPs by their venality and crookedness have virtually destroyed popular trust in Parliament. A whole host of national and international trusted figures have been caught telling lies in an effort to persuade the people not to vote for Brexit. So now many people - possibly even most people - treat whatever they're 'officially' told as suspect, with caution, and always subject to being proved. And increasingly that proof is sought through social media. 

What social media is saying about the latest Syrian 'atrocity' is that it's bollocks. They're saying there's no independent verification that a chemical incident took place, no UN observers, no news crews. People ask 'why would he?' when he's pretty well won and the US has announced it's giving up. And oh yes, they're asking, why do these alleged incidents happen just when the US is ready to withdraw?  They're laughing at pictures of a staged 'bomb' placed gently on a chipboard bed, at video showing rescuers with no masks and no protective gear entering a CW contaminated area, and they're asking why these alleged CW incidents only happen in places where the White Helmets are active. In other words, ordinary people on social media are asking all the questions that the MSM, parliament, analysts and observers should be asking. 

To we folk outside the establishment circle, it seems we're being asked to use massive military force against a sovereign nation on the basis of some short indistinct video clips showing a number of anonymous dead children who could be rebels, or their hostages, and who could have died from anything from Carbon Monoxide poisoning to EColi. No identification of the dead. No independent post-mortems, no chemical swabs, no testing of clothing. And yet within minutes of this footage and the allegations (Who made the allegations? The Al Qaeda rebels? Their white helmeted chums? ) it seemed the great and the good of the UK War faction were calling for Assad's blood, cruise missiles, reasons to keep the US in theatre.

And I could be wrong, but to my ear what most people are asking most of all is "Are the bastards lying to us again?"

Sorry Herr Juncker your woes are just starting

Later today or tomorrow senior EU official Herr Juncker will publish his official letter to the elected Prime Minister of Hungary, Victor Orban, congratulating him on his victory like an MD sending a memo congratulating his sales manager on winning the shiny shoes competition. Juncker will write of his hope for Hungary's participation in ever closer union, oblivious to the reality of democratic choice. 

The EU is quite clear however that it stands as the champion of democracy, just not the kind of democracy that involves people voting. No, for the EU democracy means compliance with the EU's standards and rules - any departure indicates a drift towards un-democracy that must be checked by sanctions and punishments, even if people voted for it. The EU's democratic principles, you understand, trump stuff like elections and voting; they are a purer form of democracy, crafted by unelected officials and demagogues free from popular approval. And yes, there are many in Brussels who actually believe all that. 

Meanwhile the Eurozone economy is stalling just as QE has reached its limit and its just one set of figures away from slipping into the first stage of recession. With the global economic cycle due to downturn next year anyway this could be a biggie. Deutschebank is slipping under the waves like some great ocean liner, each week bringing the share price closer to zero. Italy is working on a parallel currency. And now the Visegrad Four are confirmed and strengthened. Let alone Brexit. 

At home PTSD Andrew Adonis and ACGrayling are ever closer to complete meltdown, Adonis throwing petulant tantrums at the BBC for no longer being 'binary' in its output; i.e. for no longer reporting that 'Remain' has an equal chance of winning. With this degree of self-delusion, he's a natural for a cushy job in Brussels. Or rather he would be if we weren't leaving. Which raises the question; what on Earth will all the PTSD Adonises do after next year?