I know you'll all start talking about corruption and the buying of influence but, let's be honest about that problem, it's not a consequence of political parties but rather the result of how government's willingness to fix markets makes bribing politicians an effective marketing strategy.
No, dear reader, how private organisations fund themselves isn't the concern of government - assuming that they're not doing so by doing things we've decided are illegal (drug dealing, running protection rackets, intimidation - all the things Sinn Fein used to use). Yet the Electoral Reform Society has decided - from its pinnacle of righteous knowledge on these matters - that action is needed:
The public are sick to death of party funding scandals. Over the last two weeks we have been exposed to yet more findings about the suspect dealings of party donors. It brings our democracy into disrepute, and we have to do something about it.
I'm not concerned here with the question of whether those donors are good or bad people. I take the view that, regardless of the political debate, they are mostly good people who care about politics. Care enough about politics to donate large sums of money to political parties and political campaigns rather than pouring it into the bottomless pits of football, sea-going yachts and opera.
What I'm concerned with is whether there's any justification for the Electoral Reform Society's campaign:
We propose three solutions, all of which have been recommended by previous committees looking into party funding and have been shown by ERS polling and focus group research to command support from the public. These are:
- A cap on the amount that anyone can donate to a party, to end the big-donor culture that has led to scandal after scandal
- An increased element of public funding for parties, to bring the UK into line with other advanced democracies
- A cap on the amount that parties are allowed to spend, to end the arms race between parties at election time
There is huge public support for doing what it takes to get big money out of politics, so whichever party takes a lead on this could stand to benefit at the polls.
To understand why the ERS are wrong we need to appreciate a few things. The first is just how cheaply we get our politics and democracy, the second is the lack of evidence supporting a link between political donations and party policies, and the third is that (as the Americans - after decades of campaign finance reform - have discovered) there's always a get around. I also take the view that there's a matter of principle here - in a free society people should be free to use their money to campaign for the things they think are important (including, of course, their own self-interest).
British politics and democracy is pretty cheap. Really it is. Over the six years from 2008-2013, the two main political parties had a total income of £386 million (split more or less equally - Labour raised about £5 million more that the Tories). I appreciate that this isn't all the money spent on politics - other parties raise funds, there are plenty of campaign groups (some very well funded) and there's the unquantified value of all that volunteer effort we see a glimpse of on Twitter.
To provide some context here, the annual player wage bills at Manchester City, Manchester United and Chelsea are all higher, at around £200 million, than the income of either the Conservative or Labour Party for the entire period of the current government. We get all our politics paid for for less than the wages at a football club. Yes, I know you think footballers are overpaid, but this still tells us that our democracy is, relatively speaking, cheap as chips.
Generally speaking giving money to political parties isn't a great way to influence policy. It's true that there's some reliable evidence from the USA that campaign contributions and policy outcomes are linked. Moreover there's some research suggesting a link between contributions and public contracts (although mostly the contributions come after the contract not before). There's also some evidence suggesting that the more 'professional' the legislature and the higher paid the legislators, the more likely it is that campaign contributions will influence decision-making.
The evidence from the UK is more limited and mostly anecdotal. Transparency International reviewed 'Corruption and the funding of UK political parties' in 2006. This report didn't record a single identified example of 'corruption' or evidence of undue influence and opted to fall back on the same argument as the ERS:
The recent ‘Power’enquiry into the state of Britain’s democracy found that “there is a widespread perception that donations to parties can buy influence or position. It is clear that a system of party funding that relies increasingly on very sizeable donations from a handful of wealthy individuals or organisations creates an environment in which the perception spreads that democracy can be bought.”
Now there's some truth that a widespread view that money buys political power runs counter to the idea of a free democracy but the evidence of actual corruption or undue influence on policy is negligible (and yes I include the Bernie Ecclestone donation to New Labour in this conclusion). And there's not even all that much evidence closely linking donations and electoral outcome! Here's an expert on campaign finance effects talking:
For example, large shocks to campaign spending from changes in campaign finance regulations do not produce concomitant impacts on electoral success, nor do candidates with vast personal wealth to spend on their campaigns fare better than other candidates.
These findings may be surprising at first blush, but the intuition isn’t that hard to grasp. After all, how many people do you know who ever change their minds on something important like their political beliefs (well, other than liberal Republicans who find themselves running for national office)? People just aren’t that malleable; and for that reason, campaign spending is far less important in determining election outcomes than many people believe (or fear).
Our worry that somehow a shadowy bunch of hedge fund owners are somehow buying the election makes for good politics but there's precious little evidence supporting the contention that big donors - whether corporate or individual - either get what they "want" or influence the outcome of elections.
There is no case for legislation to regulate the funding of political parties any more than the degree of control needed for any private organisation be it a company, a charity or a campaign group. When the ERS refers to "scandal after scandal" it uses deliberately unspecific language - we've read the scandals in the newspapers and, if we're honest, they don't amount to any real threat to our democracy.
The losers in this dominance of party funding - including the access that can go with it - are not the voters or even the operation of government. The losers - and that's why the numbers have dwindled - are the ordinary party members. Our ability to have an influence over our party is what gives when big donors - whether institutional or individual - play such an important role. And this is the reason why I've argued for ages that the Conservative Party should simply impose an unilateral cap on the level of donations. The Conservative Club in Cullingworth will give £1,000 to the Party this year - and that club considers this to be a significant contribution. Because the Party - at a national level - is chasing those million pound plus donors, the emphasis on member recruitment, local events and the idea of the Party as a social movement as well as a vehicle for getting Tories elected has been lost. A voluntary cap on donations would force us back into doing just that - working to get ordinary folk to help us, in whatever way they can, get the sort of decent, efficient and effective government we need.
....
We
propose three solutions, all of which have been recommended by previous
committees looking into party funding and have been shown by ERS
polling and focus group research to command support from the public.
These are:
There is huge public support for doing what it takes to get big money out of politics, so whichever party takes a lead on this could stand to benefit at the polls.
- See more at: http://www.electoral-reform.org.uk/blog/deal-or-no-deal#sthash.pLfWMR8L.dpuf
- A cap on the amount that anyone can donate to a party, to end the big-donor culture that has led to scandal after scandal
- An increased element of public funding for parties, to bring the UK into line with other advanced democracies
- A cap on the amount that parties are allowed to spend, to end the arms race between parties at election time
There is huge public support for doing what it takes to get big money out of politics, so whichever party takes a lead on this could stand to benefit at the polls.
- See more at: http://www.electoral-reform.org.uk/blog/deal-or-no-deal#sthash.pLfWMR8L.dpuf
The
public are sick to death of party funding scandals. Over the last two
weeks we have been exposed to yet more findings about the suspect
dealings of party donors. It brings our democracy into disrepute, and we
have to do something about it. - See more at:
http://www.electoral-reform.org.uk/blog/deal-or-no-deal#sthash.pLfWMR8L.dpuf
The
public are sick to death of party funding scandals. Over the last two
weeks we have been exposed to yet more findings about the suspect
dealings of party donors. It brings our democracy into disrepute, and we
have to do something about it. - See more at:
http://www.electoral-reform.org.uk/blog/deal-or-no-deal#sthash.pLfWMR8L.dpuf
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