With a price tag of six billion dollars, the recent United States election season set a record for the most expensive election of all times, and re-launched the global debate on campaign finance. The complex relationship between money and democracy has sparked controversy since the beginnings of democracy in ancient Greece, when the first incidents of vote buying were reported, and has continued to do so ever since. Are private money and democracy fundamentally incompatible, or does private 'finance have a role to play in fostering political engagement? Although arguments can be made for both sides, several key reforms can be implemented across die globe.
Public vs. Private Finance: The Ongoing Debate
The concept of "one person, one vote" is one of the fundamental tenets of democracy, if not the most important one. However, as University of Missouri professor Jeff Milyo points out in his study of campaign finance, this concept does not always ensure perfect representation of each individual's stake in a certain political issue. The protection of water resources, for example, may be of particular concern to a certain minority; but if the issue is brought to general election, the concerned minority will not receive a share of the vote that reflects its direct interest in the issue. In this context, campaign financing by individuals can be viewed not as a form of vote-buying, but instead as a way for concerned minorities to voice their opinion on a topic of direct interest to them.
This was to a large extent the rationale behind the well-publicized US Supreme Court decision in Citizens United vs. Federal Election Commission. In 2010, Citizens United attempted to publicize a video critical of Hillary Clinton, which the Federal Election Commission declared a violation of legislature restricting corporate financing of political elections. The case was taken to the Supreme Court, which decided in a 5-4 ruling that Citizens United and other corporations were entitled to independent political spending under the freedom of expression protections provided in the First Amendment. Although US president Barack Obama called the decision, "a green light to a new stampede of special interest money in our politics," proponents of the decision argued that it was more compatible with democracy than the public funding alternative.
In Europe, government funds are provided to political parties in exchange for full disclosure of campaign expenditures, which has been flaunted as the best way to level the playing field between incumbents and challengers. However, a recent study by the think tank IDEA revealed that most citizens were opposed to using government funds to subsidize political parties. Although no extensive study has been conducted on the topic, there is evidently potential for the incumbent government to restrict funding in order to maintain its advantage. In Russia, for example, the incumbent party is allowed to campaign on state-sponsored official tours, whereas spending caps for other parties place a limit on the amount of campaigning they are able to undertake.
As a last argument in favor of private financing, a recent study published by Policy Analysis indicated a strong correlation between restrictions on private funding and lower levels of political competition. Limiting the amount of money that can be donated to a political party is often more harmful to the challenger than the incumbent, as the challenger typically needs more funds to increase its public prevalence. Looser financial regulations could therefore have a positive impact on the number of political options available to citizens. On the other hand, the large funds amassed by the incumbent government through private financing over several elections may also create a deterrent effect, preventing the creation of new parties. In the United States, the funds that would be necessary for a third-party to challenge the Democratic or Republican parties arguably contribute to the maintenance of the bipartisan system. …