The question of corruption goes only to formal legality.

For example, if you have a business in Indonesia or Africa, and the local police come around and solicit bribes amounting to ten percent of your turnover, in return for their “protection” from you going to jail, that is corruption; but if the Australian government passes a law confiscating ten percent of your turnover in return for not putting you in jail, that is not corruption.

However there is no difference *economically* or *ethically* between such protection racket behaviours, whether or not governments cover their actions with formal legality.

Thanks for responding Peter. I was hoping that the article would have generated a bit of debate.

Yes, your point is sound. Also, there are many examples of corruption by many Western corporations.

However, while much could be said to challenge what I said along your lines, I think the general point the data stands. There is no doubt that many developing markets, with lower corruption scores, are in good position to attract investment, even if they do little to share the wealth gained to lower income earners. Western corporations will make their profits wherever they can, and large populated markets offer the greatest potential for sales as their middle classes expand.

I have no problem with that, but I do when recipient nations (their govts) only do enough to keep the lower income earners from rioting. I also have a problem when such trends occur at the expense of our lower income earners who are already suffering most from recent reform under the guise that free trade is a win-win situation for everyone.

Previous post term 'lower corruption scores' should have been higher levels of corruption.

All the political issues rest on underlying issues of economics, which in turn rest on underlying issues of how we are capable of *knowing* things in economics. For example you make no attempt to justify your assertion that free trade makes people poorer, nor explain how you know such a thing.

I don't accept that your method is sound, namely, to assert that you eschew 'extreme' 'ideology', but look only to 'evidence' of what is 'balanced'. These assertions only beg the question; assuming that you have privileged knowledge. You don't.

Facts do not interpret themselves. This requires theory. If your theory is wrong, your conclusions will most probably be wrong.

The ideas that that there is no such thing as truth or reality, that proof of anything is impossible, that the physical laws or laws of logic do not apply to human action, and that profit is essentially exploitative, are simply ignorant or irrational. Yet as we have seen in past debates, the arguments of Marxians and Keynesians ultimately resolve to such false premises which their own advocates are unable to defend.

“I do [have a problem] when recipient nations (their govts) only do enough to keep the lower income earners from rioting. I also have a problem when such trends occur at the expense of our lower income earners who are already suffering most from recent reform under the guise that free trade is a win-win situation for everyone.”

This paragraph show a mistaken belief that there is an irreconcilable conflict of interest among the participants in free trade, and that forced redistributions are ethically and economically better. But you have never been able to defend this belief without falling back into circular argument, which is irrational.

That *method* of reasoning is unsound, because it disregards the minimal requirements of logic: you are essentially just ventilating prejudices against freedom and in favour of coercion and impoverishment whether you realise it or not.

For a simple explanation of how we are capable of knowing things, and of sound logical method in the social sciences, I respectfully refer you to: http://mises.org/daily/5014/What-Can-the-Law-of-Diminishing-Marginal-Utility-Teach-Us

Peter, i do not really want to get into theory v my style, although I respect what you are getting at.

But I thought that you may have some sympathy for what I am saying.

I will suggest a possible example, although it may or may not be factual.

what if Australia's farmers, one of most efficient in developed world in terms of less govt assistance, was being disadvantaged against Brazil where a govt may not be doing enough to prevent farmers from illegally destroying forest and acquiring land, but are then able to sell their products which become exports.