How real-world corruption works
For a simple, but topical example, you can see the process at work with the Australian Governments' current 'stimulus' program, 'Building the Education Revolution (BER)'.  This is a $16.2 billion dollar program to build new buildings on school grounds, nationwide in both public and private schools.<p>With that sort of money shovelled quickly out the door, it didn't take long for reporting of corruption and rorts to show up:   In some documented cases, the construction costs of simple school buildings mushroomed from $78,000 for a pre-BER quote to an actual built cost of $954,000.  All this for a simple school structure.  Most of the fat is in 'consulting fees' and 'variations' specified by the builders.<p>There are many documented cases of school buildings costing in excess of $5400 per square metre - about what it costs to build a top grade office block, and about 3 times what the cost would be normally.<p>The main problem, it would seem, is that all the contracts go to large building companies, who then subcontract to smaller builders, who then subcontract out to local people.  Each person clips the ticket and adds some fat on the way through, and you end up with a building costing 3 times as much.  All of this could have been avoided if you just gave the money to the school and got them to hire local tradesmen to do the job, and would have more of an effect on employment and economic activity.  As it is, a large percentage of the money will go to shareholders in large construction firms.  This is very similar to what the reddit post describes.<p>The worst thing about the whole thing is, while everyone knows it is happening, and it is in the news, nobody is actually getting into trouble.