Electoral activity: who will pay?

20 October 2019

With legislative elections now due on 26 January and general elections a little more than a year later (with the likelihood of a second round), the question arises as to how candidates and parties will finance their political activities.

The way previous elections were funded has been made clear for all to see over the last couple of years. It was the Brazilian construction companies, primarily but not solely Odebrecht, who paid handsomely for the presidential bids of Alan García, Ollanta Humala and Keiko Fujimori (amongst others). The quid pro quo for such funding was the adjudication of major construction projects in favour of these same companies. Humala also appears to have received cash from Venezuela. These sources of funding were never disclosed, so contravening the electoral law.

The only campaigns not to receive cash were either ‘no-hopers’ or the parties of the left.

The Brazilian construction companies also intervened generously to pay for the election campaigns in sub-national elections. Susana Villarán’s resort to such donors helped her in the 2013 recall campaign, while Luis Castañeda’s use of money from Odebrecht and OAS has become clear in the testimony of those who have engaged in plea bargaining with the Peruvian state. See here for more details.

But foreign funding of this sort, while illegal, reveals a deeper problem: the decay of political parties not only as channels of representation but as sources of election funding. While not just a Peruvian problem (witness how US political parties fund themselves), it is made worse by the rejection of parties by most voters. Candidates for election, therefore, will experience major difficulties in funding their election campaigns from their supporters and from the pockets of ordinary voters.

What other sources of money are there? It has been suggested that the state should make up the shortfall and, indeed, parties in Peru can count on a degree of public funding. This has the advantage of making cash conditional on transparency. But, as past practice has shown, transparency is often difficult to measure and enforce. Furthermore, voters are unlikely to favour any increase in the amounts paid from public money to parties.

The other source is from corporate interests within Peru, but this too leads to elected politicians being bought. Companies are unwilling to pay for something from which they receive no tangible return.

Perhaps the only way out of the conundrum is for elections to become much more austere events. Currently among the main beneficiaries of elections are the TV companies. The increased importance of social media may help here, but we all know how difficult it is to control the content of social media campaigns and to prevent elections becoming a competition of scurrilous inuendo.

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