Reilly S. Steel is an Associate Professor of Law at Columbia Law School. This post is based on his recent paper, forthcoming in the Columbia Law Review.
When we think about corruption in the corporate and political arenas, what often comes to mind are high-profile scandals involving bribery, kickbacks, or blatant misconduct. But in my paper Systematic Corruption (forthcoming in the Columbia Law Review), I argue that the deeper threat is structural: corruption not as isolated wrongdoing, but as an ongoing system of dependence built through state-conferred economic privilege.
At its core, systematic corruption is about how politicians use economic privileges—such as corporate charters, regulatory approvals, government contracts, and enforcement discretion—to build and sustain political coalitions. Unlike opportunistic corruption, which involves discrete quid pro quo exchanges for private gain, systematic corruption is rooted in the institutional design of political and economic power. By repeatedly rewarding political loyalty with economic benefits, governing coalitions can entrench themselves and ultimately suppress both political and economic competition. Systematic corruption is bad politics and bad economics.
A contemporary illustration comes from merger review. When antitrust enforcement becomes entangled with political loyalty—when firms perceive that favorable treatment may depend less on competition law and more on their alignment with the administration in power—merger review ceases to be a programmatic regulatory screen and instead becomes a partisan tool. Even absent explicit threats, the mere possibility that enforcement decisions hinge on political considerations can induce anticipatory compliance. Firms adjust their behavior, rhetoric, and affiliations to curry favor, helping to cement the dominant party’s hold on power. The danger is not simply uneven enforcement; it is the gradual transformation of a rule-bound process into a system of conditional privilege. READ MORE
