(Transparency; 03-02; p.3)
According to these findings, it can be stated
for Germany that most business deals in which civil servants and
other state officials participate are brought about correctly.
In a European comparison however, there are some shortfalls. These
have to be overcome to avoid "Cologne solutions" (This
is a quote of Harald Schmidt, a well-known political entertainer
in Germany, who coined the phrase for a corruption scandal in
Cologne involving city and party officials as well as entrepreneurs).
It needs initiative from legislators to prevent "boys-club"-tendencies
from spreading or becoming a fact in the first place. To call
on the individuals' morality might score in public opinion but
does not remove the incentive for such rent-seeking behaviour.
Contracts, brought about by "boys-clubbing" - by "networking"
to use a more recent term - reward the one better connected, not
the one better calculating. Therefore, they are inefficient from
a political economist's point of view; the extra-costs are paid
by the public.
There is need for action also from a democracy-legitimating
point of view. After all, a civil society is based on the idea
of a treaty: people involved are concluding contracts to their
By this construction, people have liberated themselves from feudal
societies since from that point on individuals provided with rights
e.g. give parts of their sovereignty to a state which in turn
renders the good of security to them. As relates to economics,
no longer some powerful individuals rule, but according to Adam
Smith scarce resources are distributed efficiently to the advantage
of all by the "invisible hand" of the market.
Switching off this mechanism at least needs some explanations,
be it in terms of welfare - existing inequalities in opportunities
on markets shall be evened out - or be it in terms of economical
steering - offering of some goods or services shall be supported
or avoided. However, if unjustified exceptions occur, areas without
legal or market-economical restrictions as they may be called,
a state de-legitimates itself.
(read on here)