It is not easy to be involved in party politics these days. Around the world, party membership has steadily been decreasing for decades, and according to the latest World Values Survey, the world population trusts political parties less than any other public institution. At the same time, the political arena is becoming more and more competitive as new, ad-hoc, movement-inspired organizations pop up here and there. As an inevitable result, political campaigns have become more expensive than ever. So how do political parties and candidates manage to fund their campaigns nowadays? In the best case, smart funding strategies can contribute to fair competition and closer ties to the electorate. In today’s volatile political context, however, parties may opt for solutions that compromise policy making, political accountability, and law abidance.
LEGAL: Public Funding
Public funding is the money that political parties or candidates receive from the state, either directly, or by subsidizing the cost of media access during elections: a crucial aspect of campaigning. Granting public funds enables competition on equal terms and is a great way for state authorities to ensure that political parties follow the rules. However, public funding is sometimes criticized for forcing taxpayers to support parties whose views they do not share and for incorporating political parties into the state. Furthermore, receiving public funding is very much a question of luck. Funding is dependent on whether the state administration grants such money at all and, if it does, whether a party has enough popular support to be eligible. Therefore, it is not uncommon that a party or candidate needs to rely on the methods below.
PROBABLY LEGAL: Crowdfunding
A buzzword in the world of campaign financing. Candidates that are funded by small donations from individual supporters are more likely to stay accountable to popular demands, and therefore automatically become popular among the public. Crowdfunding is not only a mode of fundraising; it forces politicians to spend more time engaging with citizens who, in turn, are encouraged to be more interested in politics. For instance, crowdfunding was a great way for the Spanish Podemos to frame themselves as a party of the people. Crowdfunding rarely risks breaking the law, since individual contributions are so small. Contributions may need to be transparent, but other than that the campaign is good to go.
POTENTIALLY LEGAL: Funding from Corporate Donors
Campaigns with a restricted budget often turn to the market for financial support. Private businesses usually benefit from certain regimes and political agendas, and may therefore support particular campaigns to increase their likelihood of winning. But there is a catch: if the party or candidate wins, said businesses also expect policies to be adjusted even further in their favor. In turn, this may produce a lack of political accountability towards the voters. All countries have restrictions on how much campaign money can be accepted from one donor, but rules outlining whether they must be domestic or whether they can be anonymous differ. Most experts, however, agree that rules need to be stricter.
POSSIBLY ILLEGAL: Funding Yourself
Wealthy candidates may donate campaign money from their own private funds or corporations. This strategy has occurred in local-level elections, for instance in Argentina and Colombia, but was made famous by Donald Trump in the 2016 US general elections. While Trump labeled self-funding as a path towards ‘independent’ policy making, it might in reality create isolation. Self-funding isolates the candidate from their voters, from the rest of the party, and, in some cases, from society at large. In the rare cases where candidates (read: Trump) hire their own companies for arranging campaign activities, they miss out on interacting with society in favor of pursuing their own business interests. Furthermore, the candidate is treading a fine line between campaigning and corruption — most countries prohibit decision-making that impacts upon the personal finances of a public official.
ILLEGAL: Funding from Illicit Networks
Campaigns that are supported by illicit networks, such as drug cartels, are particularly common in conflict-ridden contexts where the rule of law is weak, organized crime embedded, and instability has spurred the rise of new political organizations. Considering that the drug trade is immensely profitable and underground monetary transactions ignore all regulations, large sums of money can be raised from criminal networks. Other than sharing their profit, criminals may also assist with groundwork campaigning such as persuading citizens to vote or eliminating political opposition. In return, the party is expected to facilitate the criminals’ activities, for example by giving freedom from detention and investigation. This type of funding occurs all over the world, but especially in drug-trafficking corridors in Latin America and West Africa.
Which mode of campaign funding is most widely used? Unfortunately, many modern parties and candidates will use a combination of the above strategies. But the less citizens care, the more corrupt parties will be. Therefore, when campaigns finish and election day approaches, our unconditional duty remains: to vote.
