Money in Politics: Can it be Controlled?

The research consortium Money, Politics, and Transparency recently released Checkbook Elections, a summary of a two year, multi-million dollar project to examine the role of money in politics.  A principal aim of the study was to identify “what works, what fails, and why” when countries reform laws governing campaign and party finance.  To answers to these questions, researchers analyzed how and why governments regulate the financing of political campaigns and political parties, drawing on case studies of regulation in Brazil, Britain, India, Indonesia, Italy, Japan, Mexico, Russia, South Africa, Sweden, and the United States.

Checkbook Elections‘ authors tout the results, asserting the volume provides “several core findings” which offer “important lessons for policy makers both domestically and internationally wishing to support countries in their reform trajectories.” Unfortunately for those looking for ideas on what kinds of campaign and party finance reforms might help control corruption, this is hype.  The text offers but a few lessons.  None are new or terribly important or generalizable.  The study, however, does contain an important conclusion, one which the authors are candid enough to report even if they don’t feature it.

First, the lessons the volume offers reformers.  There are four, shown in bold as they appear in a text box both in the introduction and the conclusion along with excerpts from the box elaborating on them —

  1. The limited effects of legal regulations.  “[T]he comparative analysis was unable to establish that the degree of state regulation alone has any significant impact, positive or negative, on long-term societal and political outcomes, including the goals of strengthening political party competition, voter turnout, and anti-corruption.”
  2. The most common reforms in recent years have sought to strengthen disclosure and public funding.
  3. The effects of formal legal reforms are contingent upon enforcement, which in turn depends on regime type, state capacity, and societal cultures. “[L]egal regulations can only prove effective in states with enforcement capability. .  .  .  Even in countries that do have the capacity to enforce regulations, the political will to do so must also be present.”
  4. Mixed policy strategies work best. “[A] balanced mix of regulatory policies to control political finance is probably the most effective strategy, ideally blending a combination of disclosure and transparency requirements, limits on spending and contributions, and public subsidies to political parties.”

So laws without enforcement are not enough, and enforcement requires political will.  Furthermore, most recent reforms involve a mix (not specified) of disclosure and public funding, and some mix (again unspecified) of reforms “is probably” best.  Thin gruel for reformers hungry for guidance on “what works.”

To be sure, the case studies offer a couple of nuggets.  From the Indonesian one we learn that developing states should not impose too many regulations too soon.  From the Russia study we are told that public financing of political parties has entrenched Putin in power.  The authors of the study of the United Kingdom’s several decade efforts to control money in politics helpfully advise that:  “Regulation is most likely to be effective if legislators work in cooperation with the parties being regulated, and if implementing agencies can offer advice and guidance, as well as being charged with enforcement.” Finally, the Japanese study teaches that: “under particular conditions [not specified], increased state regulation of political finance can strengthen political competition and reduce election costs.”

For policymakers trying to control the corrupting effect of money in politics in their countries, these lessons boil down to:  one, make your country like Japan and two, work with those to be regulated – and all the while don’t impose too many rules and be careful not to create an autocrat.  Policymakers will probably want a bit more detail before they start to write a reform bill.

On the other hand, while the authors don’t trumpet the real lesson of the study, they don’t hide it either.  The main finding of their study of campaign and party finance regulation: “the level of state interventionism in the political finance arena is not a significant predictor of perceptions of corruption, voter turnout, or party competition.” This result leads the authors “to be agnostic about the effects of state interventionism in the political finance regime on each of these longer term societal impacts.”

That’s an important concession coming from a group of researchers that, judging by their rhetoric, favor interventionist policies.  And whose funders are likely sympathetic to more regulation.   But it is better to candidly acknowledge the futility of most campaign and party finance reforms than go crashing about “reforming” the political process.  Anyone with doubts on that score, see the U.S. experience since 1971.

At the same time, even to this skeptic of campaign finance regulation, the authors’ conclusion seems a tad too strong, a reaction perhaps to their disappointment with the findings from the case studies and the results of the cross-national analyses.  But just what can be done deserves a separate discussion, one that I invite readers to contribute to.

One thought on “Money in Politics: Can it be Controlled?

  1. Pingback: Of nuclear zombie blasters and party funding | Sussex Centre for the Study of Corruption

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