Money Power begins frontal attack

New Zealand’s great image as a clean country clear of political corruption is at the risk of being desecrated if the Government, the Opposition and other like-minded parties do not intervene and stem the dirty growth.

Many workers with allegiance to political parties told me in confidence that money has begun to talk in determining candidates for local elections.

“I can tell you without hesitation that if you can put money where the Party’s mouth is, you can be sure of the ward you want. You need not even be a member of the political grouping to start with; you can always become a member after you are assured of the place,” an Aucklander said.

Indians in the fray

The entry of some persons of Indian origin into the political arena has begun to not only complicate matters but also divide the community.

Indian Newslink has received reports of meetings and in some cases recorded evidence of some people claiming that “Important people were in their pocket and that large sums of money given as donation during Election 2008 campaign had brought them close to the powers that be and decision makers.”

A rich entrepreneur, not in an obscure profession, boasted to common friend of having funded the entire campaign cost of a candidate.

“I have promised him more for 2011. I know what they want but they should also know what I want.”

The use of money to buy political influence is as old as democracy itself, and as fresh as today’s headlines. Some time ago, the Labour Government in Britain unveiled new proposals to regulate political funding, just when (by coincidence, says the government) questions were being raised about Michael Ashcroft, a major donor and party treasurer of the Conservative opposition.

In the US, the Democrats raised record sums, just to compete with the Grand Old Party (GOP) in the last election.

Money & Democracy

Money Power- National Party officials.jpgMoney Power-Labour Party.jpgJust as Catholics believe that you cannot have humanity without original sin, political scientists accept that you cannot have democracy without money.

Democracies are based on political parties and in order to exist, organise, campaign and communicate, those parties need money.

Even in America, where raising and spending campaign money is overwhelmingly the business of individual candidates rather than their parties, the latter provide an invaluable cover for the raising of unlimited “soft money.”

In New Zealand, the Electoral Commission believes that considering how free and fair an election is, there are often questions of balance and each country will have to make its own decision, based on its own circumstances and values.

“For instance, rules about campaigning must balance the rights of candidates, parties, and others not contesting the election to be able to put their arguments to the people with the rights of free speech without restriction.

“In order to achieve equal access, parties with less money may be helped and those with more money restricted, which will curb their freedom of speech.”

Speech may be free, but making oneself heard is not.

Costs have also been pushed up by the professionalisation of politics. Just as the 17th century witnessed the transition from ad hoc militias to standing armies, the 20th and 21st centuries have seen a change in political parties. They now need to be permanent, expensively staffed organisations, not just groups that crystallise temporarily for elections and then melt away again.

It is easy enough to legislate against (if not always to detect) politicians using public office for personal enrichment.

It is much harder to prevent politicians becoming unduly beholden to the groups or individuals who finance their campaigns.

Prime Minister John Key has done well to make his administration and more important, the lives and times of politicians more transparent and accountable to the public. This in itself a good thing, but since the moneyed hawks cannot be controlled, there is a need to discipline politicians.

Mobilising Finance

How can parties raise the cash they need without incurring these obligations?

Some sources of money are unobjectionable. In most countries, parties will raise money from their supporters in membership fees. In some countries, such as Germany, parties require elected officials to give a proportion of their salaries to party funds.

Parties that need to build a mass membership will encourage a healthily widespread political participation. No individual member can expect his or her membership fee to sway the party’s policies. And if the levy on professional politicians is compulsory and uniform, their contribution does not give them greater influence on policy than they already enjoy through their position in the party.

But dues and membership fees inevitably fall short of parties’ total needs.

One approach is to ban political donations from certain sources.

The US bans political gifts by foreigners, while others limit gifts by institutions.

Japan, for example, prohibits political donations by companies most likely to be affected by public-policy decisions; money from subsidised private enterprise, for example, or from companies in deficit, is now taboo.

In some countries, firms or trade unions may need the consent of their members or shareholders before they can give money.

Many countries now require donations to be reported. In America, candidates have to report the source and size of any donation over $US 250. Although the requirement to report donations may not stop would-be influence peddlers, it makes politicians and parties much more wary of taking their money, and ensures that they will have to justify any decisions that are in the interests of their donors.

A number of countries feel that reporting, by itself, does not go far enough. So they impose limits on the size of individual contributions. Americans are not allowed to donate more than $US1000 to the campaign of any individual candidate, although they are also allowed to give $5000 a year to a political action committee (PAC), which can then campaign on the candidate’s behalf.

But limits are seldom watertight. Money can help a party or candidate without being paid directly into their funds. Interest groups associated with a candidate, a union, for example, or an anti-abortion group can raise and spend money effectively on their behalf.

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