The Mind of a Corrupt Organization

In “Unknown Truth or Untrue Conspiracy?” and “Is Institutional Corruption Only a Conspiracy Theory?” we learned about some of the most shocking government and corporate “conspiracy theories” that are actually true, despite self-serving governments, corporations, and political operatives who try to convince us that they are merely conspiracy theories. In this article, we’re going to explore why systemically corrupt organizations behave the way they do. (As you read, please keep in mind the precise definition of corruption that I use in all my articles.)

Entering the Mind of a Corrupt Organization. Let’s recall an important question: “Why is Truth Often Disregarded as a Conspiracy Theory?” Because governments and corporations that have systemically corrupt cultures engage in a particular form of corrupt behavior that makes it extremely difficult for untrained people to distinguish between truth and fiction.

The D4 Strategy: Deny, Diffuse, Deceive, Destroy. Systemically corrupt governments and corporations create existential ambiguity in the minds of the public, the courts, and anybody trying to ascertain the truth about their actions, by using what I call the “D4 Strategy.” This is a four-phase socio-politico-economic strategy that escalates through each phase, typically in the following sequence.

  • Phase 1—Deny: Deny and dismiss your accusation of abuse as ridiculous or unsubstantiated, regardless of how voluminous your evidence may be.
  • Phase 2—Diffuse: Diffuse the issue and confuse the public with a flood of irrelevant information, bury the adverse consequences of their abuse in vague statements like “Our product is a healthy part of a balanced diet” (processed sugar is not a healthy part of any diet) or “We take your privacy and civil liberties very seriously, which is why we only capture non-personally-identifiable metadata from your communications.” (Triangulated metadata is usually far more invasive and “personally-identifiable” than discrete content data.)
  • Phase 3—Deceive: Manipulate, conceal, and distort unflattering product safety data, destroy historical data and records, lie and mislead in every possible way to avoid having to admit any wrongdoing.
  • Phase 4—Destroy: Litigate and bury you with lawsuits, attack your character, launch and finance bogus front groups to discredit and destroy your reputation, destroy your financial ability to defend yourself.

How Should We Analyze Bad Institutional Behavior? The beneficiaries of institutional corruption are often invisible or unexpected. As we learned from the CIA’s Project Mockingbird deceptions, it is relatively easy for governments and corporations to co-opt the media by using journalists to spread their propaganda. That means we can’t always trust our first impressions whenever we see a news story in the media. We should always think critically about the information presented and make sure we understand the context. We should ask ourselves:

Who are the winners and losers during any particular scandal? Who benefits from concealing the truth? Who benefits from the widespread awareness of the truth? What incentives do the winners and losers have to distort my perception of reality?

After thinking about the answers to those questions for a while, then we can make our decisions about what is right or wrong based on a relatively complete understanding of the truth, not based on emotionally-charged or politically-motivated soundbites.

The “Noble Lie”. Are some truths too dangerous to reveal; or are all truths healthy for society? Is it ever ethically justifiable to conceal truth from large populations? The Greek philosopher Plato explored these questions 2,400 years ago in his political philosophy classic, The Republic. From Plato’s perspective, the “noble lie” was a necessary evil of the state because he believed that people need to be deceived and manipulated into behaving according to the best interest of society. Plato’s assumption was that certain noble lies are in the best interest of the citizenry, but what if the state’s interest deviates from the best interest of the citizenry? That’s exactly what happens when a government is deficient in integrity and legitimacy.

One Man’s Noble Lie is Another Man’s Instrument of Ignoble Oppression. As the power of the state grows to infiltrate every sphere of human existence, every lie becomes a pretext for ever-more lies. This scaffolding of lies expands the power of the state beyond the control of well-intending state officials and creates ever-more opportunities for self-serving officials to abuse state power. Every example of atrocious government and corporate behavior that we’ve learned about so far demonstrates this truth.

Despots Must Control the Production and Distribution of Knowledge. During Plato’s time until the beginning of the 21st Century, despots and politicians had the means and motive to conquer land and people then rewrite history to whitewash their transgressions. Their ability to control the production and distribution of knowledge gave them the ability to control the perception of reality for present and future generations. That power enabled them to create an illusion of beneficence and historical continuity for their authoritarian regimes by weaving together a combination of myths, lies, truths and half-truths to justify their oppression.

The Permanent Memory of Humanity in the Internet Age. As we’ve seen from the Victorian Holocaust, the Vietnam War, the Iraq War, the JFK assassination, among others, the advent of the Internet empowers the masses with rapidly available knowledge and the ability to verify and corroborate knowledge sources. This new egalitarian power deprives governments and corporations of their previous ability to permanently sanitize their unflattering history. This means humanity now has a much more accurate and permanent collective memory with the ability to rapidly improve its accuracy after each major event.

The Internet Makes Life Difficult for Authoritarians. Prior to the Internet, it required much more time for large numbers of people to perceive the same reality because information traveled between minds at much slower speed. This created gaps of information between individuals, organizations, and governments. Information gaps represent pockets of ignorance within a society, which authoritarian regimes have historically exploited to divide and conquer groups of people with the intent of controlling the political and economic affairs of the state. However, for any given issue of interest to the masses today, the Internet can substantially eliminate most pockets of ignorance between government and large populations, which is making the lives of politicians with dictatorial inclinations much more difficult today.

The Internet Demolishes All Big Lies. Plato could not have predicted how a real-time global communications network would create a real-time global human consciousness. Thus, he could not have foreseen how ineffective every big noble lie is today. (In this case, a “big lie” is any lie that is intended to control large populations.) The Internet will demolish all big lies—noble and ignoble—over time because truth flows like water: You can block it with propaganda when it’s a trickle, but after it grows to a torrent, no government on Earth can stop it. And information torrents can emerge so rapidly and unexpectedly today that governments and corporations can no longer confidently predict which direction the torrents will flow. That means the divide-and-conquer political and communication strategies that worked for authoritarians in the past will fail to achieve their long-term goals in the present and future.

The Paternalistic Attraction to Coercive Power. In private, politicians and many citizens with paternalistic tendencies often claim that noble lies are necessary to preserve national unity and avoid the devolution of civil society into chaotic anarchy. In reality, their conscious or unconscious fear is the disintegration of state power, which diminishes their personal power and their ability to extract wealth from society through taxation, the confiscatory power of the state, and the monopoly power of corporations, which is aided and abetted by the state. The paternalists claim that state power is the sole means of binding a nation together, but then they habitually abuse state power for their own personal gain, which undermines the legitimacy of the state. In the Internet Age, this loss of state legitimacy is continuously remembered and reinforced among the masses in real-time, which ironically causes state power to disintegrate even faster.

Even the Smallest Noble Lie Destroys State Integrity and Legitimacy. If the paternalistically-minded politicians who claim that noble lies are necessary really cared about the principles of liberty, free markets, and civil society, they would not abuse state power in the first place. If they really cared, they would devote all their time and energy to a nonpartisan campaign focused on implementing nonpartisan systems of government performance accountability to restore the institutional integrity and legitimacy of the state. The power of the state in any age, especially the Internet Age, can only be derived from the perceived integrity and legitimacy of the state. Anything—even the smallest noble lie—that diminishes the perceived integrity and legitimacy of the state undermines state power. All good-faith political and corporate leaders in the 21st Century and beyond should understand and behave according to this principle.

Authoritarians Are Compelled to Censor Global Consciousness. The challenge to authoritarianism that the Internet represents is leading to escalating actions by governments to censor the free flow of information to control global consciousness. This is also true for large corporations who seek to control the wealth extraction apparatus of government. The largest corporations behave similarly to state governments in this regard: Both governments and large corporations seek to control global consciousness because they both depend on the wealth extraction power of the state to perpetuate their control and exploitation of large populations.

Large Corporations Emulate State Power. When the financial power of a corporation grows to the size of a small- to medium-sized country (The top-1,000 transnational corporations as measured by revenue match this criterion.), their incentives invariably deviate from the incentives of their customers. Large-scale financial power carries within it the seed of coercive state power because it is financial power that gives both public and private institutions the ability to deploy propaganda and weapons of all types. Only with these instruments of mass coercion can states and corporations control global consciousness and the physical behavior of large populations to serve their particular agenda, which is invariably defined by the preferences of the people who wield that power. Every corporate monopoly and cartel demonstrates this phenomenon.

The Convergence of State and Corporate Interests. The convergence of state and large corporate interests to control the public’s perception of reality ultimately results in the alignment of joint government-corporate censorship campaigns, which are led by governments and supported quietly by the largest corporations. This reality reveals the weak commitment that large corporations have to free-market capitalism, i.e., what large corporations really want is corporatism, fascism, mercantilism—any socio-politico-economic system that can be co-opted by financial power to thwart true representative government and free-market capitalism. This enables them to control the flow of wealth throughout an economy and channel public and private resources to their shareholders.

The God of Shareholder Value. In the early 1980s, American capitalism mutated into a religion that worships a god called “shareholder value.” This religion was thrust upon all public corporations because corporate raiders started using junk bonds and leveraged buyout strategies to force all public company executives to pray to the same god. In this religious environment, if a corporate executive refuses to pay tribute to this god—i.e., export American jobs to foreign countries and squeeze their customers for every possible penny to satisfy the clerics on Wall Street—they are crucified by the raiders and pushed off their thrones when the raiders invade their corporate temples. This fear of the raiders has been institutionalized and is the fundamental cause of the short-term, quarterly profit-driven mentality that dominates American public corporations today. (The virulence of this religion was also amplified by “What’s Really Wrong with the Banking System?”)

The Destructive Power of Shareholder Value. No matter what public corporations may claim, an organization dominated by the god of shareholder value will inevitably slide into corruption because the structural incentives that shape public company behavior today require them to increase shareholder value at the expense of the public interest. Theoretically, legitimate governments can minimize the negative impact of corporate power by enforcing rational and evenly applied industry regulations. However, illegitimate governments exploit the convergence of state and corporate interests to maximize their combined coercive power over their customers and constituents.

Coercive State and Corporate Power are Destructive to Free-Market Capitalism. Special interest groups and the minds they control will deliberately misrepresent the meaning of this article by falsely painting it as an endorsement of Marxism. From their self-serving perspective, anything that hints at balancing the coercive power of corporations with the best interests of society is instantly twisted into a totalitarian conspiracy to destroy liberty and free-market Capitalism. When you see them do this, you will know they are merely trying to distract the public from their own abuses of state and corporate power. In reality, this article is not an endorsement of Marxism nor an indictment of free-market Capitalism; it is a logical acknowledgement of the inevitable convergence of interests between state and corporate power, which is fundamentally destructive to civil liberty, economic freedom, and free-market Capitalism.

How Should Governments and Corporations with a Sinister Past Behave? I’ve seen some people say things like, “OK, so empire-building is nasty business, but we can’t dwell in the past; so just let it go.” The problem with that logic is this: Unless government and corporate officials take responsibility for their bad behavior and punish the people that perpetrate bad actions, they have no incentive to stop acting badly or to fix the systemic incentives that induce bad behavior. In contrast to habitually evasive and deceptive government behavior, here’s a refreshing example of a G20 government with integrity that takes responsibility for its past transgressions. The result is far more trust in their government, more trustworthy corporations, more harmonious and productive labor relations between corporations and employees, higher-quality government policy outcomes, greater institutional integrity, and greater respect for the rule of law throughout the entire population.

The Path to Truth and Reconciliation. Authentic reconciliation with the victims of past government and corporate abuses is only possible after the truth is unambiguously revealed, sincere apologies are unequivocally given, laws are justly enforced, proportional punishment is expeditiously delivered, and meaningful restitution is unconditionally provided. This is why formal truth and reconciliation commissions are so important to cultural and national healing; yet, throughout their entire histories, the U.S. and U.K. Governments have never conducted a truth and reconciliation commission to address their horrendous crimes against humanity. This is one reason why ever-larger swaths of humanity despise them.

Political Tribalism Destroys the National Spirit. The political culture in the United States today is not guided or even affected by good-faith leadership. At any given moment, there may be certain individuals in government who possess admirable leadership qualities, but the incentive structures within the federal government today neutralize their capacity to achieve meaningful institutional reforms. The result is a constant drift toward financially-motivated tribalism. Competing financial tribes brandishing different ideological swords, while pursuing fundamentally identical illicit goals, fight amongst themselves to divide the rotting carcass of a dying economy, which is being devoured by transnational cannibals. Their battlefield is the sacred memorial of the hearts and minds of a disenchanted citizenry, which they destroy with each new self-serving act of tribal war.

Culture is Defined at the Top. The reason corporate corruption is so rampant in the United States today is because (1) political corruption is so rampant; (2) the god of shareholder value destroys far more long-term value than it creates; and (3) an ever-expanding police state is perpetually redefining human activity into criminal activity, which is another manifestation of an illegitimate state. In every society and organization, culture is defined from the top-down. The integrity of a society is dependent upon the perceived integrity and quality of its government. For all of America’s impressive historical achievements, our nation’s best days will be trapped in the past unless the integrity and legitimacy of the U.S. Government are restored.



About Ferris Eanfar

Ferris Eanfar has over 20 years of experience in technical, financial, media, and government intelligence environments. He has written dozens of articles and several books in the field of International Political Economy, including Broken Capitalism: This Is How We Fix It, which provides unique insight into what is wrong with the global economy and how to fix it. To learn more about Ferris, please visit the About Ferris page.

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