Tag Archives: Elections

India’s New Electoral Bond Scheme Won’t Reduce Electoral Corruption. It Will Make the Problem Worse.

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Indian elections have long been celebrated as a festival of democracy—in part for their sheer and increasing scale, with over 900 million voters and thousands of political parties registered. Election expenditures have also been on the rise. India’s last national elections were the most expensive elections ever held anywhere in the world, with an estimated expenditure of Rs. 55,000 crores ($7.74 billion)—much of which was financed through private donations. In India as elsewhere, all this private money in politics raises concerns about corruption, both legal and illegal. This problem is exacerbated by a lack of transparency.

Under the rules as they existed until two years ago, individuals and domestic for-profit companies could contribute to political parties via cash, check, or demand drafts. Political parties are required to file an annual income statement, listing both sources of income and expenditures, with the Election Commission, a constitutional oversight body. These statements are publicly accessible under India’s Right to Information law. However, contributions below Rs. 20,000 ($280) could be anonymous, and political parties traditionally exploited this loophole to avoid disclosure of donors. The total share of income from unknown sources has been steadily increasing for all six major political parties, and in the last returns filed for 2017-18, income from unknown sources was over half (51.38%) of these parties’ collective income.

Over the past two years, there have been several reforms to campaign finance. The most significant reform has been the replacement of cash donations with a new mechanism for political donations, so-called “electoral bonds.” Under this system, the threshold for anonymous cash donations was reduced by a factor of ten, but private parties can now make anonymous donations via a bond with the State Bank of India (a public sector bank) in fixed denominations ranging from Rs. 1,000 ($15) to Rs. 1 crore ($1.5 million), during allotted windows. These donations remain anonymous not only to the general public, but also to the recipient political party.

The stated objective of these reforms is to target the practice of money laundering in campaign finance and increase transparency. In a previous post on this blog, written shortly after the new scheme was introduced, Abhinav Sekhri argued with cautious optimism that this tool, though imperfect, was indeed a step in the right direction. I disagree. In fact, the electoral bond system has decreased transparency and increased the potential for corruption, for several reasons: Continue reading →

The Limited Effect of Corruption Allegations on Voters: A Brief Analysis of Prime Minister Netanyahu’s Reelection

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Last fall, Professor Stephenson alluded to the confusion that many in the anticorruption community feel regarding “voters in many democracies [who] seem to support candidates that are known or reputed to be corrupt.” This confusion was shared by many of my (non-Israeli) colleagues over the last few weeks, upon learning that Benjamin Netanyahu won the April 2019 elections and will serve as Israel’s Prime Minister for a fourth consecutive term (and fifth term overall), despite being suspected of various corruption offenses, including bribery and breach of trust (see here, here, here, and here). (Saying that Netanyahu won the elections is slightly inaccurate in a technical sense, since in Israel voters do not vote directly for the candidate they wish to serve as Prime Minister, but rather for the party they wish to represent them in the parliament (the Knesset). Nonetheless, 26.46% of the voters supported Netanyahu’s Likud party, making it one of the two largest parties in the Knesset; many other voters supported various other right-wing parties that were sure to join Likud to form a government.) Does the fact that so many Israelis cast their ballot in favor of Netanyahu’s party, or other parties sure to back Netanyahu for Prime Minister, mean that Israeli voters simply do not care about corruption?

The short answer is no. The longer answer is that there are three main reasons why voters may have chosen to support Likud despite disapproving of corruption:

Continue reading →

Presidential Power Grab: Corruption and Democratic Backsliding in Mongolia

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Mongolian democracy is in trouble. On March 26, President Khaltmaa Battulga proposed emergency legislation that would grant the presidency unprecedented powers to dismiss members of the judiciary, the prosecutor general, and the head of the state anticorruption agency (the Independent Authority Against Corruption, or IAAC). One day later, parliament approved this legislation by a vote of 34-6 (with 36 members of parliament either absent or abstaining), despite the fact that President Battulga hails from the Democratic Party (DP) while the rival Mongolian People’s Party (MPP) controls parliament. Technically the law doesn’t grant the dismissal powers directly to the president, but rather to a three-member National Security Council (NSC) composed of the president, prime minister, and speaker of parliament, and an oversight body called the Judicial General Council. But President Battulga dominates the NSC and personally appoints the members of the Judicial General Council, giving him effective authority to remove Mongolia’s judges and chief law enforcement officials at will. Sure enough, promptly after the law was passed, Battulga dismissed the head of the IAAC, the Chief Justice of the Supreme Court, and the prosecutor general.

This new legislation, a crippling blow to Mongolian democracy, has its origins in corruption, and corruption is likely to be its effect. President Battulga induced parliament to grant him such extraordinary powers by claiming that he alone can really take on Mongolia’s severe corruption problem. In his statement to parliament introducing the new legislation, Battulga alleged that the country’s law enforcement leaders were “part of a conspiracy system” that “fabricat[ed] criminal cases with a political agenda” while covering up others. The president pointed to Mongolia’s numerous unresolved corruption scandals to argue that the institutions of justice were “serving the officials who nominated and appointed them” rather than the public, and he argued that reducing the independence of the judiciary, the prosecutorial apparatus, and the IAAC would make those institutions more responsive to the popular will to fight corruption.

President Battulga is correct when he asserts that Mongolia has a corruption problem of serious, perhaps epidemic, proportions. Mongolians regularly list corruption as one of the country’s biggest issues (second only to unemployment in a 2018 survey) and political institutions such as parliament and political parties as among the most corrupt entities. The past few years have been especially scandal-plagued. During the 2017 presidential campaign, all three candidates faced accusations of corruption; most egregiously, the MPP candidate—who, until January 2019, served as speaker of the Mongolian parliament—was caught on video discussing a plan to sell government offices in a $25 million bribery scheme. Further, late in 2018, journalists discovered that numerous politically-connected Mongolians, including somewhere from 23 to 49 of the 75 sitting members of parliament, had been treating a government program designed to provide funding for small- and medium-sized enterprises (SMEs) as a personal piggy bank, taking out over a million dollars in low-cost loans. Beyond these scandals, Mongolia’s poor enforcement record compounds its corruption problem. For example, in 2015, only 7% of cases investigated by the IAAC resulted in convictions, and in 2018 public approval of the IAAC reached an all-time low.

But is there any reason to believe that President Battulga is right that giving him greater personal control over law enforcement and the judiciary will lead to less corruption? All the evidence points to no:

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How Can India Cleanse Its Politics of Dirty Money?

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India’s 875 million voters make it the world’s largest democracy. Yet Indian elections, though generally seen as free and fair, have become the country’s “fountainhead of corruption.”Parties and candidates spend billions getting themselves elected—current forecasts predict $8.5 billion will be spent in the 2019 election, making it the most expensive election globally. Much of that money comes from illegal or at least questionable sources, a problem exacerbated by the fact that campaign financing in India is a black box, with no transparency into donors or income sources. Recent changes by the Modi government have made the process even more opaque. And much of the money raised is spent illegally. For example, up to 37% of Indian voters have received money for votes. 

The massive amount that politicians are willing to raise and spend to win elections is understandable when the payoff to the winning candidate is considered. Putting aside any ideological or egotistical motives for seeking public office, there’s also a material incentive: studies have found that, in the years following an election, winning candidates’ assets increase by 3-5% more than losing candidates’ assets, and this “winner’s premium” is even higher in more corrupt states and for winners holding ministerial positions. The material benefits of office may also partly explain the alarming percentage of Indian politicians with criminal histories. Currently, over a third of Members of Parliament (MPs) in the Lok Sabha (the Lower House of the National Parliament), are facing at least one serious criminal charge, and politicians with cases pending against them are statistically more likely to win elections. Moreover, the ever-greater spending on elections means that winners, in addition to lining their own pockets and saving for the next election, need to repay those who helped them prevail. The more money politicians spend on elections, the more they need to earn back or repay through political favors.

The high payoff to candidates who win elections (often because of the opportunities for corruption) both attracts dishonest individuals to seek office and encourages ever-higher election spending, which in turn inspires corrupt behavior to repay debts, whether through money or political favors. Therefore, any serious attempt to reduce corruption in India has to begin with electoral reform. The constitutional body tasked with administering elections in India is the Election Commission (EC). The EC oversees the election process, and it also can issue advisory opinions (though not binding decisions) regarding the post-election disqualification of sitting MPs and Members of State Legislative Assemblies (MLAs). The EC is also responsible for scrutinizing the election expense reports submitted by candidates. But the EC is in many ways a toothless tiger, able only to recommend actions and electoral reform to Parliament, without any real power to fix the electoral system. 

There are, nonetheless, a few things that the EC could do now, acting on its own, to help address at least some of these problems. But more comprehensive and effective reform will require action by the legislature or the Supreme Court.

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Israel Needs to Fight Official Corruption. That Doesn’t Mean It Should Deprive Elected Officials of Their Right to Silence.

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On April 9, 2019, millions of Israeli citizens will vote in the national legislative elections for the party they wish to represent them in the parliament (the Knesset). Numerous ongoing investigations into corruption allegations against senior officials and various public figures (including Prime Minister Benjamin Netanyahu) ensure that anticorruption will feature prominently on the agendas of most major political parties. One can only hope that the next elected Knesset will manage to pass effective anticorruption legislation. However, one piece of anticorruption legislation that has been repeatedly proposed should not be adopted: a de facto limitation on senior elected officials’ right to silence in criminal interrogations in which the officials are suspects. (The proposed legislation would also de facto limit elected officials’ narrower right of refraining from answering specific questions when doing so may put them at risk of criminal prosecution; for the sake of brevity I will discuss only the broader and more comprehensive right to silence.) Currently, elected officials enjoy the right to silence just like any other suspect in a criminal case in Israel, yet proposals have been repeatedly floated that would require certain high-level elected officials (such as the prime minister, ministers, Knesset members, or mayors) who exercise this right to be removed from office. Most of the bills, which differ from each other in certain respects, would apply to criminal interrogations related to the officials’ duty, but some go even further, with a broader application to any kind of criminal interrogation in which the officials are suspects.

The explicit goals of these bills are strengthening the war on corruption and promoting public trust in the rule of law. So far, none of these bills have been enacted, but Knesset members from across the political spectrum have been flirting with this idea for the last few decades, almost always in response to occasions in which Israeli officials (whose political views typically diverge from those of the proposing Knesset members) chose not to cooperate with the interrogators in corruption investigations. It is very likely that something like this will be proposed again in the next elected Knesset, as some parties have already declared in their official platform that they intend to promote such legislation.

While I agree that an elected official’s refusal to answer interrogators’ questions inspires a great deal of unease, adoption of the aforementioned bills would be unjustified and even dangerous. Although the proposed bills do not technically eliminate elected officials’ right to silence, requiring a public official to give up his or her position as a condition for exercising this right is a sufficiently severe sanction that the bills unquestionably impose a severe practical limitation on this right. If Israel were to adopt such a rule, it would be a significant outlier among peer nations: Research conducted by the Knesset’s Research and Information Center in 2007 found no equivalent limitation on elected officials’ right to silence in numerous legal systems around the world. Taking such a step would therefore be unprecedented, but more importantly, it would be unwise, for several reasons: Continue reading →

Putting Elected Officials in Charge of Elections Is a Recipe for Corruption: Evidence from U.S. States

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One of the stories that figured prominently in last November’s U.S. elections was that of Brian Kemp, then Georgia’s Secretary of State and now the state’s new Governor. As Secretary of State, Kemp was responsible for administering the state’s elections—but in 2018 he was administering the very election in which he was running for governor, which creates an inherent conflict of interest. Indeed, there was plenty of evidence that Kemp used his position as Secretary to increase his odds of winning the election: He attempted to close polling locations in neighborhoods likely to vote for his opponent, promulgated abnormally stringent voter registration rules that put thousands of voters’ eligibility into question, and launched what most observers considered to be a groundless investigation into his opponent’s campaign in the week before the election. Ultimately, after ignoring calls for him to recuse himself, Kemp announced that he would resign as Secretary of State two days after the election, while the votes were still being counted. Kemp was eventually declared the winner, though his opponent, Stacey Abrams, never fully conceded, vowing to sue Kemp for “gross mismanagement of the election.”

It’s hard to see how an election administrator’s use of his power to benefit his own political campaign is anything other than corrupt. Indeed, Kemp’s controversial election illustrates how the U.S. electoral process is particularly vulnerable to this sort of corruption. (And, it’s worth noting, while Kemp drew most of the attention, there were two other candidates in the 2018 elections that found themselves in the same position, with one choosing to recuse himself from the recount process back in August 2018 during a close primary.) In most U.S. states, the Secretary of State (who is responsible for administering the state’s elections) is an elected official, and in over half of the states, Secretaries of State can run for public office while serving as Secretaries. This is out of step with most of the developed world, where election administration is independent and apolitical. Reformers have called for changes to this system before, so far without much success. But the atmosphere may now be ripe for anticorruption advocates to propose referenda to create new, independent, and non-partisan systems for election administration. A well-designed system could eliminate the clear conflicts of interest raised by people like Brian Kemp, while also tackling the more insidious and less obvious forms of corruption that arise when party members use their power over election administration to ensure that their party stays in power.

What might such a system look like? Canada may provide a useful model, given its similarities to the U.S., particularly with respect to its federalist structure. In Canada, each province is responsible for administering its provincial elections, while the Canadian national government administers national elections. The Canadian election administration systems share a few key components that keep the electoral commissions independent and non-partisan, and that all U.S. states should adopt: Continue reading →

Let Them Speak: Why Brazilian Courts Were Wrong to Bar Press Interviews with an Incarcerated Ex-President

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In July 2017, Brazil’s former President Luiz Inácio Lula da Silva (“Lula”) was convicted on corruption and money laundering charges. His appeal was denied in January 2018, and he started serving his sentence in April 2018. Although Lula was in jail, his party (the Workers Party, or PT) attempted to nominate him as its candidate for the October 2018 presidential elections. But pursuant to Brazil’s Clean Records Act (which Lula himself signed into law when he was President), individuals whose convictions have been affirmed on appeal cannot run for elective offices. Though Lula and his defenders argued that he should be allowed to run anyway, his candidacy application was denied; ultimately, as most readers of this blog are likely aware, far-right candidate Jair Bolsonaro defeated the PT’s alterative candidate, Fernando Haddad, in last October’s election.

Perhaps less well known, at least outside of Brazil, is the fact that in the run-up to the election, Lula received several invitations from the press to give interviews. Although there is no clear rule on whether prisoners are allowed to give interviews in Brazil, past practice has been to allow the press to reach out those in jail under the authorization of the prison management. After the prison denied several requests by media organizations to interview Lula, those media outlets turned to the courts, asking for the right to interview Lula. The courts said no. The Brazilian Supreme Court, in an order by Supreme Court Justice Luis Fux, issued a preliminary injunction blocking the interviews stating (in a free translation from Portuguese): Continue reading →

Some Things Are More Important Than Corruption (Brazilian Elections Edition)

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In the anticorruption community, it is fairly common to puzzle over—and bemoan—the fact that voters in many democracies seem to support candidates that are known or reputed to be corrupt. “Why,” we often ask, “do voters often elect or re-elect corrupt politicians, despite the fact that voters claim to despise corruption?” One of the common answers that we give to this question (an answer supported by some empirical research) is that even though voters dislike corruption, they care more about other things, and are often willing to overlook serious allegations of impropriety if a candidate or party is attractive for other reasons. We often make this observation ruefully, sometimes accompanied with the explicit or implicit wish that voters would make anticorruption a higher priority when casting their votes.

We should be careful what we wish for. Continue reading →

Guest Post: After the Tsunami–Mexico’s Anticorruption Outlook Under Andres Manuel Lopez Obrador

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Today’s guest post is from Bonnie J. Palifka, Associate Professor of Economics at Mexico’s Tecnológico de Monterrey (ITESM), and Luis A. Garcia, a partner at Villarreal-VGF specializing in corporate compliance and anticorruption matters:

The results of Mexico’s federal elections last July have been described as a “tsunami” for Andrés Manuel López Obrador (AMLO) and his National Regeneration Movement, known by its Spanish acronym “Morena.” AMLO won 53% of the popular vote and Morena swept the House and Senate, as well as a majority of the nine state governorships up for grabs and several local legislatures. This is all the more remarkable considering that Morena was founded as a civil society organization in 2011 (and registered as a political party in 2014), and was fighting for control of Mexico’s political left against AMLO’s former party, the PRD. Many are hopeful that AMLO will lead a transformation of Mexico into a modern, peaceful, fair, and prosperous society like Chile or Uruguay, while others fear that he will take the country down the route of Venezuela. That the same person can engender such different reactions is due in part to the vagueness and inconsistency of AMLO’s rhetoric throughout the campaign: sometimes he would take a highly confrontational and uncompromising attitude toward Mexico’s political and economic elite—what he termed the “mafia of power”—while at other times he would strike a more conciliatory tone. But one consistent theme in AMLO’s rhetoric—and in the analysis of the data on the reasons for Morena’s electoral triumph—was profound indignation at the blatant corruption and impunity of Mexico’s political and business elites.

Mexican voters’ frustration with corruption is understandable. Although in recent decades Mexico has undertaken a number of anticorruption measures—including, under former President Vicente Fox, a new freedom of information law, and, under current President Enrique Peña Nieto, a new National Anticorruption System (SNA), which, among other things, updates national and state laws to criminalize more acts, reduce immunities, and increase punishments—these measures have been insufficient, as reflected in Mexico’s increasingly poor showing on the Corruption Perceptions Index. AMLO identified corruption as Mexico’s most pressing problem and promised to bring about an honest and transparent regime that would be truly responsive to the country’s needs. And, in an encouraging sign, AMLO has brought in a diverse group of highly respected experts and activists, from all sides of the political spectrum, and has appeared flexible and open to dialogue. At the same time, though, he has displayed a puzzling blind spot for potential conflicts of interest, and his optimistic rhetoric has suffered from a lack of specificity, coherence, and concrete proposals. Continue reading →

Is Trump Administration Corruption a Winning Issue for Democrats this November?

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The corruption of the Trump administration is bad news for the United States—will it also prove to be bad news (politically) for Trump’s Republican Party allies? A number of astute political commentators have recently argued that the answer is yes. Most notably, Jonathan Chait published an article last week making the case that “corruption … is Trump’s greatest political liability,” and that even though Trump himself is not on the ballot in the 2018 midterm elections, it would be wise politics for the Democrats to focus on the corruption of the Trump administration in their quest to retake one or both chambers of Congress.

Chait notes, as an initial matter, that despite Trump’s historic unpopularity, Democrats face two interrelated challenges: First, there’s just so much negative news about Trump—from the Russia investigation to his racism and misogyny to the lurid revelations regarding his crude attempts to cover up an affair with an adult film actress—that it’s hard to focus on any one thing. Second, and more importantly, the majority of Trump’s supporters already knew back when they voted for him that he was a crass, crude, adulterous bully and bigot–which means that pointing out his infidelity, his bullying, and his bigotry now isn’t likely to have much impact. (The Russia investigation is another matter, but Chait suggest that it’s too abstract and complex for most voters.) Corruption, according to Chait, is the one story that could move the needle, even with Trump supporters. Chait’s reasoning (presented in a somewhat different order from his original article) runs as follows: Continue reading →