Laughing Money, Crying Money

For these past years I have been conducting integrity development and anticorruption seminar workshops, this phenomenon of laughing money and crying money keeps cropping up. This is especially pervasive in almost all government offices and has been identified as an important element of the whole gamut of graft and corruption issue in the Philippines.

For anticorruption research, this phenomenon can also serve as a very useful analytical tool. The challenge now is really to conduct more empirical studies and conceptual scrutiny of how laughing money and crying money really pervades and reinforces widespread corruption in the Philippine bureaucracy in particular, and the Philippine society in general.

What is laughing money and crying money? One needs to first understand the latter to appreciate the former.

Crying money, also known as blood money, is understood to cover all and any resource that is due to government, and if somebody steals the resource it results in government loss. Some examples of crying money are:
  1. Public funds, government loans and grants
  2. Taxes, fees, collections, levies, permits, duties, tariffs, excises, tolls, duties
  3. Government time (officials and employees paid by government)
  4. Government supplies, equipment, vehicles
  5. Government facilities, buildings and infrastructure
  6. Government services
On the other hand, laughing money refers to any resource that is not due to government, and if somebody steals the resource, there is no loss to government. Some examples of laughing money are:
  1. Gifts from contractors or private individuals
  2. Tips, commissions and other perks (in kind)
  3. Donations and contributions
  4. Free travels, free club memberships, gift certificates
It is important to note that stealing in both cases are taken liberally, and could also mean in the broader sense. Stealing may imply diverting, undermining, withholding (in the case of public service), loafing (in the case of government time), sneaking, accepting for personal use, embezzling or pocketing among others.

How does this phenomenon of crying money and laughing money relate to or reinforce widespread graft and corruption?

There seems to be a general acknowledgment that crying money directly correlates with graft and corruption since the resource is really owned by government. There is no debate that those who steal crying money are committing acts of graft and corruption, and by so doing they taint their hands with blood (that is why crying money is also called as blood money).

What is more contentious is the phenomenon of laughing money. And many are using laughing money to justify their anomalies and rationalize stealing in various forms and names. But imagine the effect of laughing money in many of these actual cases and everyday experiences of many government officials and employees:
  1. Developing a special treatment to a bidder who gives cash commissions or gifts in kind to the members of Bids and Awards Committees.
  2. Coming up with favored decisions or actions for suppliers whose companies give perks like free plane fares, free hotel accommodations, all-expense paid travels to conferences and vacations, sponsorships to parties and other public gatherings.
  3. Or a favored court judgment in exchange for a big retirement mansion.
  4. A purchaser who benefits from gaining extra appliances for patronizing a supplier; the purchaser's house is fully filled up with all the free appliances from bread toasters to computers to sala sets to washing machines to air conditioning units.
  5. A regulator who gives priority to approve license applications given by fixers, who give additional commissions paid by their clients. Or approves application papers even if they lack documentary requirements.
  6. Favored clients who give gifts and all other goods during Christmas season.
While these and many other similar examples do not imply immediate loss to government, laughing money undermines the government and the public in the long term. People's decisions and actions are affected (or corrupted) by these resources, even if they are owned by private individuals. Private corruption has a way of permeating into public corruption. The blurring effect is as dirty as it can get!

To the extent possible that laughing money involves public transactions, it is still part of graft and corruption. Even if there is no financial and immediate loss to government, laughing money has the capacity to corrupt people's behavior and distort systems. In the end, the same blood that taints the hands of the crying money also stains the face of the laughing money!

See also the Sutton's Law of the Impunity of Profit.

(Photo courtesy of http://www.cerebromente.org.br/n16/mente/mask.jpg)