Controlling money and politics – an exercise in damage control

No democracy is immune from the corrosive effects of money on politics. The United Kingdom, Germany, Italy, and other established democracies have all experienced recent political scandals.

Furthermore, once civil society and the media in transitional regimes gain the resources and ability to uncover abuses and corrupt practices, such scandals may become increasingly reported in those countries as well.

Political finance-related corruption manifests itself in a variety of ways:

• In some cases, the ruling political party directly abuses state resources in order to improve its electoral chances.
• Private businesses that benefit from public contracts or privatisation contribute large campaign donations.
• Wealthy donors may also launder and provide campaign funds to control political parties or purchase seats in parliament; these donors may have ties to undesirable elements, such as organised crime or terrorist networks.

While transparency in political finance can expose poor governance practices, it does not inevitably lead to good governance. Indeed, there are instances where greater knowledge about political donors deepens apathy and cynicism among voters.

Nevertheless, newly introduced political finance regulations in Bosnia and Herzegovina, Latvia, Liberia, Mexico, Poland, and the United Kingdom have brought increased transparency and a degree of equity to the monetary aspects of politics. In particular, strict reporting obligations have been adopted with respect to party income and donations over a certain value. The obligations also contain restrictions on foreign and anonymous donations. Many countries set limits on the value of donations that parties are entitled to receive, and restrict party election spending. Most importantly, several countries have set up their own independent statutory oversight bodies.

Arguably the funding of political parties in most democracies is more transparent than a decade ago. But some countries, including the USA, Kenya and Indonesia, still have much work to do in terms of regulating the role of money in their political systems.

Marcin Walecki
International Foundation for Election Systems (IFES), 1101 15th Street, NW, Third Floor, Washington, DC 20005, USA
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