Politics of money — how to clean up party funding
by Andrea Abel van Es,
2015-07-27 06:35:58.0
WHAT do Russia, the US and SA have in common? Not often lumped together, all three countries face significant challenges regulating money in politics.
Through the manipulation and regulation of political finance, Vladimir Putin and his United Russia party have been able to entrench their rule.
In SA, the complete lack of regulation — bar public funding — has served the African National Congress well. The US has created a system of political finance that ensures inherently unequal opportunities for participation.
The role of money in politics challenges rich and poor countries. Its abuse raises issues of corruption and cronyism and undermines legitimacy and governance.
However, money is essential for mobilising election campaigns, sustaining political party organisations and communicating with citizens. Countries such as Sweden have managed to avoid falling foul of malfeasance and graft, despite almost no regulation of money in politics.
So, how can the role of money in politics be cleaned up most effectively? New evidence is available from a comparative report and data set released by the Money, Politics and Transparency project, produced by Global Integrity, the Sunlight Foundation and the Electoral Integrity Project.
The project investigated three crucial questions.
How do countries attempt to regulate the role of money in politics? What triggers landmark reforms? What works, what fails, and why?
The project website presents evidence from its political finance indicators, comparing 54 countries worldwide. The report compares how this problem is tackled in emerging economies as diverse as India, Mexico, SA and Russia, as well as in established democracies such as Britain, Japan, Sweden and the US.
Policies regulating the role of money in politics include disclosure requirements, contribution limits, spending caps and public subsidies. Most countries use a combination of these policies to try to regulate the flow of money into politics.
Another way to think about regulation is the degree to which governments intervene in political finance. This can range from a laissez faire approach to comprehensive regulations.
Using data from the International Institute for Democracy and Electoral Assistance, the project used statistics to show that countries such as SA, Sweden and India have more laissez faire policies, while others, such as Brazil and Russia, are more interventionist.
It is difficult to say whether more or less legal control is better. This is because effective regulation requires enforcement.
India has a highly regulated system of political financing, but its enforcement capabilities are so weak that more laws simply lead to almost all political actors increasing their efforts to find loopholes.
And not every country is like Sweden. Its social and political culture allows it to have a highly effective and egalitarian system of political funding. Sweden has a high degree of transparency and a level playing field in party competition — despite almost no regulation.
The project’s political finance indicators find that transparency requirements are one of the most common reforms implemented during the past decade.
But disclosure rules are often inconsistently applied.
The results suggest that eight out of 10 countries have statutes requiring parties and/or candidates to submit contribution and expenditure reports.
But this rarely happens during campaign periods.
The public is, therefore, unable to access much of the information reported to oversight authorities.
Further, restrictions on contributions and expenditures are often undermined by loopholes. Laws often limit the amount an individual can donate directly to a political party or to a candidate, but not both. Similar loopholes in regard to anonymous and corporate donations are common.
Excessive regulation can lead to loophole-seeking and entrenched elites. However, lax regulation can lead to skyrocketing campaign costs, corruption, cronyism and winner-take-all politics.
• Andrea Abel van Es is a senior research fellow at the Electoral Integrity Project at the University of Sydney. This article appeared on www.theconversation.com
SA has a laissez faire approach towards regulating political funding. Picture: THE TIMES
WHAT do Russia, the US and SA have in common? Not often lumped together, all three countries face significant challenges regulating money in politics.
Through the manipulation and regulation of political finance, Vladimir Putin and his United Russia party have been able to entrench their rule.
In SA, the complete lack of regulation — bar public funding — has served the African National Congress well. The US has created a system of political finance that ensures inherently unequal opportunities for participation.
The role of money in politics challenges rich and poor countries. Its abuse raises issues of corruption and cronyism and undermines legitimacy and governance.
However, money is essential for mobilising election campaigns, sustaining political party organisations and communicating with citizens. Countries such as Sweden have managed to avoid falling foul of malfeasance and graft, despite almost no regulation of money in politics.
So, how can the role of money in politics be cleaned up most effectively? New evidence is available from a comparative report and data set released by the Money, Politics and Transparency project, produced by Global Integrity, the Sunlight Foundation and the Electoral Integrity Project.
The project investigated three crucial questions.
How do countries attempt to regulate the role of money in politics? What triggers landmark reforms? What works, what fails, and why?
The project website presents evidence from its political finance indicators, comparing 54 countries worldwide. The report compares how this problem is tackled in emerging economies as diverse as India, Mexico, SA and Russia, as well as in established democracies such as Britain, Japan, Sweden and the US.
Policies regulating the role of money in politics include disclosure requirements, contribution limits, spending caps and public subsidies. Most countries use a combination of these policies to try to regulate the flow of money into politics.
Another way to think about regulation is the degree to which governments intervene in political finance. This can range from a laissez faire approach to comprehensive regulations.
Using data from the International Institute for Democracy and Electoral Assistance, the project used statistics to show that countries such as SA, Sweden and India have more laissez faire policies, while others, such as Brazil and Russia, are more interventionist.
It is difficult to say whether more or less legal control is better. This is because effective regulation requires enforcement.
India has a highly regulated system of political financing, but its enforcement capabilities are so weak that more laws simply lead to almost all political actors increasing their efforts to find loopholes.
And not every country is like Sweden. Its social and political culture allows it to have a highly effective and egalitarian system of political funding. Sweden has a high degree of transparency and a level playing field in party competition — despite almost no regulation.
The project’s political finance indicators find that transparency requirements are one of the most common reforms implemented during the past decade.
But disclosure rules are often inconsistently applied.
The results suggest that eight out of 10 countries have statutes requiring parties and/or candidates to submit contribution and expenditure reports.
But this rarely happens during campaign periods.
The public is, therefore, unable to access much of the information reported to oversight authorities.
Further, restrictions on contributions and expenditures are often undermined by loopholes. Laws often limit the amount an individual can donate directly to a political party or to a candidate, but not both. Similar loopholes in regard to anonymous and corporate donations are common.
Excessive regulation can lead to loophole-seeking and entrenched elites. However, lax regulation can lead to skyrocketing campaign costs, corruption, cronyism and winner-take-all politics.
• Andrea Abel van Es is a senior research fellow at the Electoral Integrity Project at the University of Sydney. This article appeared on www.theconversation.com
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