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Electoral finance law tar-baby in Australia too

  • August 16th, 2009

I had not noticed that the Australian Labour Party is pushing through new donation reporting requirements for "amateur" participation in democratic debate. Here is the summary of CIS’s Andrew Norton of the effect of changes now waiting for Senate consideration.

"To reduce the influence of private money on politics, the federal government plans to significantly expand regulation of political donors. Anonymous donations exceeding $50 would be banned outright. Gifts of $1,000 would have to be disclosed, down from nearly $11,000 now.

These rules apply to non-government organisations that express political views as well as to political parties. In fact NGOs face greater disclosure burdens than political parties. They must itemise their expenditure between five overlapping categories, while political parties need provide only one total sum. NGOs must report annually on their spending on ‘election issues’, even for future elections with issues that cannot be known for certain. NGO donors are potentially treated very unfairly. Donors’ names and addresses are put on the Australian Electoral Commission website if their gift finances political expenditure, even if the donor is unaware of how their money is used.

NGOs face significant dangers from these rules. Their staff and volunteers risk fines and jail for breaching the rules. NGOS run by political amateurs may not be aware they have any obligations. But the requirements are so unclear that even political professionals could easily make a mistake. The other danger is that NGO donors will be deterred. The disclosure rules give governments the names of their political opponents. This creates opportunities for improperly disfavouring people tendering for government business or applying for government grants. Cautious donors may decide that revealing their NGO allegiances is too costly.

It’s a mistake to think that ‘dollars and democracy’ are necessarily opposed. Private donations to NGOs are a vital part of Australia’s democratic political system. Without these gifts, many views would go unexpressed, many voices would never be heard, and many criticisms of government would never be made. Plans to ban or deter NGO donations have no place in a democratic society. "

Law restricting campaign donations and spending are classical tar-babies. 

All over the world they only work, even moderately, if they are amended constantly to block new "loopholes". The amendments soon prove to be not enough, so complication gets piled on to complication.

The ingenuity of democratic parties and supporters quickly creates new ways to evade the law but outsiders to the political establishment are even more problematic.

Why are these laws so hard to write and to enforce?

Because the "balance" that the political professionals want to ‘protect’ from ‘resource imbalances’ or ‘distortion’ can never be achieved if outsiders are allowed to speak freely to their fellow citizens.

Citizens have the effrontery to believe that elections are their chance to tell their rulers what they value and what they do not, by persuading each other (not the rulers) who to sack and what to support or to oppose. This is the opposite of politician thinking. Political insiders think that elections are for them. Election time is when they get the attention of voters who usually have better things to watch, read and listen to. The professionals want to make sure their game is played on terms they control.

Rude and enthusastic outsiders disrupt that game, especially if they are passionate enough to want to be effective, and so are willing to pay to communicate with their neighbours and fellow citizens. 

But the politicians can not say openly what they really want to ban. To work they really need to ban unauthorised and unoficial participation in democratic debate. It upsets the "balance" the ruling politicians want to ‘refine’ with their spending and donation limits.

A  direct gag would be too obvious. It would outrage even those innocent academic fellow travellers with the politicians,  who think that their wiser friends can ‘fine tune’ restricitions without seriously imperilling the persuasion rights that are the justification for free speech. 

 When law has to be written to say lots about things you do not want to happen but can not say directly what it is really about it will be expensive, and constantly discredited by evasion and misuse. So we have seen in the last decade a parade of democratic leaders charged with campaign finance law breaches. Far from enhancing confidence in the democratic process these irruptions damage it. We’ve seen the Presidents of France, Germany, senior UK leaders, President Clinton all tangled in campaign finance scandals that are equated with ‘corruption".

Pressure to exploit ‘loopholes’ is inevitable all over the democratic world where campaign spending limits are in place. The most high-minded and sincere politicians may feel most compelled.

The solution is to confine the law to what it can do, and what should be its focus:

a) – the unequal use of tax money and state assets by incumbent politicians to campaign to retain power,

b) – exposure of funding influences from  sources which could be indifferent to the interests of New Zealand as a whole (so I support attention to foreign donations); and

c) –  factually false claims in powerful media very close to polling when there is no opportunity for normal democratic challenge and debate to correct them.

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It will be interesting to see if Australia Labour do what they did here – realise that this might not be in their best interest after the fact.

Good post. We are incredibly lucky that the intent of the EFA didn’t work (i.e. get Labour back into power), and that National got rid of it. One wonders what restrictions they would have considered for the election after?


Nice post. Really waiting to see the development of Australian Democracy.

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