Technically, corruption covers an entire host of abuses, of which graft is one. Graft and corruption are charges that are typically leveled at highly-placed government officials, who are able to use public funds to improve their own fortunes due to increased access, influence, knowledge or power that comes with an elevated position. An official engaging in bribery, nepotism, embezzlement, extortion or graft is guilty of abuse of public trust at minimum, and may often be charged with a crime.
As mentioned above, the vice of corruption includes many possible acts. According to the Merriam-Webster dictionary, the word means "impairment of integrity, virtue, or moral principle." The word is a noun that dates to the 14th century and is related to the notions of decay and depravity. The denotation also includes secondary definitions that account for the inducement of wrong in another via bribery, and notes that corruption is a departure from the original or pure form of a thing or idea.
Graft is defined as a use of public stature to gain illegal benefit. For instance, a senator who sits on the armed services committee in the U.S. senate cannot use his knowledge of military contracts to buy stock in a defense contractor's company. His position gives him unfair advantage over other investors. It is similar to the notion of insider trading in business.
The Pennsylvania capitol building in Harrisburg is a famous example of graft in action. The massive public structure was completed in 1906 at a cost of $12.5 million. This was a hefty increase over the $5 to 10 million estimate. The architect and chief contractor of the building were convicted of overcharging the state for several items, including an $850 bill for a flagpole that actually cost $150.
A more recent example is the trial of former Illinois governor Rod Blagojevich, who has been accused of soliciting cash from suitors in exchange for appointment to an empty senate seat that he controlled.
It can be difficult to tell the difference between graft and other types of corruption. In some cases, the differences are slight. For instance, the main difference between bribery and graft is the element of public finance.
A police officer who looks the other way because criminals pay him off is accepting a bribe. A senator who approves a military budget that includes $300 hammers and $600 toilet seats is engaging in graft.
A recent case in China shows the difference between embezzlement and graft. Real estate developers in that country were charged with both. Graft because one defendant also served on a local government development board that had influence on the bid process, and embezzlement because another diverted company funds to purchase personal investments.
Exposing corruption can be difficult. Appointing internal agencies to keep an eye on corruption may simply lead to more opportunities for graft. One reason corruption is more difficult to hide in democratized countries is freedom of the press. In societies where the press is under government influence, investigations of corruption can be easily quashed. Often, citizen-led groups are formed to keep an eye on specific industries or government processes. These are called watchdog groups, and they rely on independent, generally non-profit charters to preserve a reputation of integrity.