Corruption is one of the greatest challenges of the contemporary world. It undermines good government, fundamentally distorts public policy, leads to the misallocation of resources, harms the private sector and private sector development and particularly hurts the poor. Controlling it is only possible with the co-operation of a wide range of stakeholders in the integrity system, including most importantly the state, civil society, and the private sector. [Transparency International] recognizes the shared responsibility of actors in all the regions for corruption, and its emphasis is on prevention and on reforming systems, not on exposing individual cases; TI considers that the movement against corruption is global and transcends social, political, economic and cultural systems. TI is politically non-partisan; and TI recognizes that there are strong practical as well as ethical reasons for containing corruption. (Excerpt from Transparency International's Mission Statement)
As national economies around the globe are becoming increasingly linked to one another and to the ideals of liberal democracy and free-market capitalism, a discourse of anti-corruption has emerged as one of the newest organizing schemas of international governance, development and business. There is a moral and ethical assumption that certain "bad", morally bereft and economically damaging behaviors constitute "a cancer" and as such should be labeled corrupt (Wolfenson 1999). Corruption must be cut out if democracies and free markets around the world are to develop sustainably (Wescott 1997, Eigen 1999, Stappenhurst and Kpundeh 1999, Robbins 2000). It is chiefly international development institutions and NGOs within the United States and Europe such as the World Bank, United States Agency for International Development (USAID), United Nations Development Program (UNDP), Organization for Economic Cooperation and Development (OECD) and Transparency International (TI) that have led the battle cry against corruption. Eradicating corruption, these institutions propose, will enable a logical progression towards economic growth through transparency, accountability, efficiency, good governance, an equitable distribution of wealth and improvement in social welfare, resulting in a reduction in poverty and the assurance of sustainable development (Eigen 1999b, Clay 1997, World Bank 2000, de Magalhčes 2000, Transparency International 2001), and ultimately, democracy (Mosley, Harrigan and Toye 1995).
These institutions promote themselves as the vanguard of anticorruption experts, led by the World Bank and Transparency International. By standardizing definitions of corruption and identifying specific strategies for “combating corruption” (Eigen 1999b) these institutions are concurrently inferring that they themselves are uncorrupt. Defining and identifying function as acts of demarcation and distancing. Unlike standard development knowledge claims, this expertise is not scientific in nature. Stemming from a rationality reflected in the neoliberal economic policies expected to stymie corruption, these experts take a larger step toward claims of moral and ethical clarity. Corruption is not only illegal, but it is immoral. Corruption reflects a condition of underdevelopment, not scientifically, but morally, ethically, and economically. It is the next level in the demarcation between underdevelopment and development, i.e. modernity. The morality of anti-corruption has become an important justification for invasive neoliberal economic policies and international institutional intervention.
Peter Eigen, the founder and chairman of Transparency International, proposes “three key pillars” of the global effort to reduce corruption: private business, government and civil society (Eigen 1999b). While each pillar is responsible to address the unwieldy nature of corruption in different ways, Eigen and others suggest that it is civil society that has the widest public support and strongest moral position from which to take on corruption (Eigen 1999a, Eigen 1999b, Westcott 1997). The anti-corruption institutions characterize civil society as the sector driven by the greatest level of altruism and purity, maintaining the authentic qualities of democracy inherent to making choices based on the greater good to society. Authenticity and purity are juxtaposed to the essential character of corruption. A variety of actors, such as international finance and development institutions as well as NGOs, utilize these concepts to legitimate their own behavior, as well as to create images of themselves and/or others that cloud the true issues of corruption inherent to both the formal and informal realms in Panama. This promotes a romanticized notion of NGOs as the moral watchdogs in developing nations.
In every nation of the world, the development of practices now labeled as nepotism, bribery, donning favors, extortion, fraud, trafficking and embezzlement, have their own particular histories that impact the form these practices take in each national societal setting. The chairman of TI, Eigen acknowledges that there is cultural relativity involved in what he terms corrupt.
(W)hat may be described as corruption, can vary from one society to another. This is particularly true with practices surrounding gifts, legitimate and illegitimate hospitality and the use of personal connections. There is no one line between culturally and socially accepted behavior on the one hand and nepotism and corruption on the other and each society has to draw this for itself. (Eigen 1999a)
As Eigen infers, practices that exist in an unofficial sphere are not without rules or legitimization, within their immediate context. Agreements that may be judicially illegitimate are not necessarily socially or politically illegitimate. Quite to the contrary. Generally, a nation’s populace, or a particular segment of the population is well aware of how the system works and how to work the system to their own benefit. As Robbins points out, "(corruption) is not the absence of rules but the presence of alternative norms" (Robbins 2000: 426). Often the official system of “anti-corruption" is actually the less-practiced alternative, the cover story for the informal system of exchange and power brokering that forms the basis for well-known standardized rules and norms. Economic historian Alan Fowler calls the coexistence of formal and informal rules and practices “the living system” (Fowler 1991: 54). What is termed corrupt by one faction is the normalized system of another faction, for whom transparent practices are masks, the alternative to familiar and well-developed systems and networks of favors and payments. The World Bank makes a similar point by writing, "In some of these countries high levels of corruption may be a stable equilibrium, with political elites, bureaucratic functionaries, entrepreneurs, and ordinary people all bound by its rules" (World Bank 2002).
In Panama, there is a long tradition of corrupt practices, locally termed juega vivo, functioning at all levels of society in a variety of contexts. Corruption in Panama can only be understood within an international context, as Panama’s history and traditions are strongly linked to its history as a service economy and the corresponding influence and relations with international economic, political and social forces, particularly those of the United States. Not only is corruption associated with Panama’s formal service-based economy, but with illegal arms trading, drug trade and money laundering, all vital facets of Panama’s informal economy. These rules and norms are woven into the societal fabric, the expectations and rituals of day to day life. Informal exchange systems, particularly those at a national, regional or local scale, often necessitate intimate personal knowledge of the various people involved in the exchange - what are someone's likes and dislikes, what and how much they produce, to whom they are related and where they went to school. It is a very personal system of networking and exchange that solidifies social relations.
The environmental arena, associated as it is with the reversion of the Panama Canal, with USAID and other large international governmental and nongovernmental organizations, is a new forum for the replication and morphing of established practices and traditions at the level of elite and middle class. At the same time, the newly developing environmental arena has created the possibility for new actors, such as rural mestizo and indigenous farmers and the local leadership to enter into the practices of corruption, both overtly and covertly.
In this chapter, I question why corruption has become such an important discourse at this particular moment in time. What is accomplished through the extension of a morally universal anti-corruption standard by particular institutions of the industrialized North? What are the roles of corruption and the tradition of juega vivo in Panama, and what are its connections with the expansion of democratic and neoliberal economic agendas?
I provide an overview of some of the history and issues of corruption particular to Panama, often referred to as juega vivo. I exemplify the ways in which all classes adopt their own behavior to fit within the relations of power and make new adaptations according to the opportunities presented by the resources available from environmental conservation projects.
Through the examination of the structural position of environmental NGOs to the overall system of power, I demonstrate that rather than curbing corruption, environmental NGOs are a key site for the growth and extension of normalized practices of corruption in Panama at all class levels.
 Throughout this chapter when I refer to the institutions promoting an anti-corruption discourse, I am referring to these organizations first and foremost.
 I use the terms corruption and corrupt practices throughout this chapter. In doing so, I am referring to practices that the institutions listed above suggest as corrupt rather than as a description of practices that are inherently morally or ethically corrupt.
There is a danger in over-emphasizing the “traditional” and relativized nature of Panama’s informal networks and the unique way that corruption has become a major thread in the national culture. It is counterproductive to encourage romantic notions of local practice as natural, good, pure or authentic. Once again, it is concentrating on what is produced by a confluence of actors and their actions that keeps this romanticization at bay. In fact, these traditions are in part responsible for the extreme income disparity between rich and poor in Panama. The exclusive sharing of wealth and power among elite and to a lesser degree, the middle class, has by and large prevented lower urban and rural populations from entering into the political and economic arena with them. Those who have the power to grant access to resources, to give contracts, reduce taxes, help put someone else in a position of power, turn a blind eye on unsanctioned activities etc., are one part of this equation. Those who have something valuable to give in exchange are another part of the equation. Often the poorest sector of the population, which has little monetary or social capital with which to negotiate deals, is unable to partake and benefit from high-level informal systems of exchange and gift giving. Favors and the acquisition of jobs and contracts tend to circulate among the elite upper class, reinforcing income disparity and limiting the economic advancement of the lower classes.
 While in Panama, I met with a Panamanian woman working at the American Embassy. Initially her job had been to keep track of Panamanian legislation as well as formal agreements made with the United States. But a year earlier her job shifted and she was now responsible for introducing Americans politicians and business people working with the Embassy to the appropriate people in Panama. With a smile on her face, she told me that in order to connect someone to the correct important people, the most vital information for her to keep track of was “who was sleeping with whom in Panama”. With this thinly veiled joke, she was telling me that deals in Panama are made in a way that has little or nothing to do with formal agreements. Linking people to the appropriate social and political connections is based on her intimate knowledge of the lives of the elite class.