Wednesday, October 17, 2012

Importance and Limits of Electoral Finance Transparency

Romney and Obama are taking the privately funded route in the 2012 U.S. presidential election. Therefore, neither of these candidates have campaign expenditure limits. In 2008, Obama took the privately funded route and raised $800 million USD. Both Romney and Obama are projected to top that amount in 2012.

Finances play a significant part of the political process, as can be seen by the numerous news articles on the importance placed behind the finances surrounding the upcoming United States presidential election on November 6. But what happens when the public doesn’t have access to the numbers behind the finances? Does this create any problems?

Just imagine if the government stole $500 from the bank account of every citizen on any particular day, but no person is ever allowed to view that government's bank accounts to determine if it were true. This is a similar problem that is faced by many nations around the globe when dealing with the transparency of finances surrounding elections. In fact, the recent Venezuelan presidential election that just occurred faces this problem. The Venezuelan government insists that there are no illegal acts committed in regards to these finances, but no one will ever know because the bank accounts are not transparent to anyone except for those persons within the ruling government party itself.

The FDA and no one else has evidence of electoral finance wrongdoing in countries such as Venezuela, because the finances are only transparent to the state. Interestingly, Chavezites like Eva Golinger claim that the U.S. government has funneled 40 million to opposition parties by U.S. Agencies such as USAID, NED, Republican International Institute, Democratic International Institute, Freedom House, Pan American Foundation for Development, and Institute of Open Society (Soros). So, there is motivation for the Venezuelan State to counter the influence of foreign money on the election process. Yet, Venezuelan election laws disallow foreigners from contributing to election campaigns. Surely, Venezuelan authorities would be able to trace opposition funds, and thereby prevent the influence of foreign monies. Unfortunately, due to no one having access to this information, this cannot be done to ensure national security and the best interests of the people within the country.

This creates a huge problem for the citizens of these nations, since there may be foreign influence upon the lifestyles of those citizens from foreign funding. Just imagine the impact that would be realized if North Korea had the ability to influence American politics, and no one could trace where the funds were coming from… For enough money, would this influence the government to make certain decisions? Maybe this may not be the case in America, due to its current economic position and sources of money, but just imagine a country similar to Greece. With such desperation to receive funding, would a country like this change their governmental policy to accommodate another foreign interest? And if so, how could we keep them accountable for their actions? Without transparency of finances, you can see where massive problems can exist, and these problems affect entire nations and the interests of those people.

The FDA just completed an Electoral Fairness Audit of Venezuela, and the country received a 50.0% score under Electoral Finances. If the country were to allow transparency of finances, the country would have received a score in this category of 65.0% and would have increased its overall score from 78.0% to 86.9%. Here, you can see the significant impact this has on the overall importance of democracy.

In contrast, in a recent Electoral Fairness Audit, the United States received 48.0% score under Electoral Finances. However, unlike Venezuela, American electoral finances are fully transparent to the public. The deficiency in the case of the American system stems mainly from no caps or limits on nonconnected third party contributions and expenditures, and no expenditure limits on privately funded presidential candidates and congressional candidates. So electoral transparency itself does not guarantee fair and equitable finances. Electoral finance laws must be balanced with strong laws on contributions and expenditures as well.

For more information, feel free to see the media advisories on Venezuela and the United States:

Media Advisory on Venezuela

Media Advisory on the United States

For more information on the Foundation for Democratic Advancement, please visit our website at FDA The FDA is currently undergoing an in-depth study of the United States and the national media surrounding the 2012 election; to donate to this important study and help improve the democratic process within the United States, please donate to the FDA by visiting FDA's Indeigogo Campaign

Dale Monette, FDA Director of Finance and Stephen Garvey, FDA Executive Director

Question for Readers:

Is no electoral finance transparency more detrimental to democracy than electoral finance transparency with highly deficient caps and limits on campaign contributions and expenditures?

1 comment:

  1. I am nervous to see what happens to the Canadian economy if the US defaults. Could the economic situation they are in, been avoided if fianances were available for public viewing and would the public step in and hold the government accountable?


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