Paying for politics

Abstract

In Disclosure V. Anonymity in Campaign Finance, Ian Ayres broaches a very particular issue in the design of democratic institutions, discusses that issue in a very particular context, and advocates a very particular institutional remedy. The specific issue concerns the regulation of information concerning political donations. The specific context has two relevant dimensions. Ayres is clearly concerned with the case of the US, and, implicitly and explicitly, the discussion takes many other aspects of the US political environment as the relevant background. At the same time, Ayres is primarily concerned with the prevention of corruption, so that the relevant criterion by which alternative institutional regimes are judged is just the extent to which corruption is deterred. Within this context, Ayres argues that the norm of full anonymity in respect of political donations would operate more effectively to prevent corruption than would the norm of full disclosure; so that rather than ‘sunlight [being] the best of disinfectants; electric light the most efficient policeman’, Ayres argues that total darkness is the real cure for corruption. Ayres’s constructed ‘veil of ignorance’ is nothing like Rawls’s, but it does involve a putatively constructive use of ignorance in the same way that Rawls’s construction does. The essential argument is simple enough. Under full information, all campaign donations are matters of public record, so that there can be nothing covert about the funding process; nevertheless, the possibility of buying political favours is still present. Indeed, in the limit, one might imagine that competitive political donations constitute a straightforward market for political influence that operates alongside the electoral process to determine political outcomes. Whether or not we describe open financial transactions in such a market as ‘corrupt’1, or ‘unfair’ (given an unequal distribution of income and wealth), there is certainly a presumption that such a ‘market’ might be expected to influence political outcomes and so reduce the reliance of political outcomes on the electoral process and other more strictly ‘political’ mechanisms. At the other extreme, under perfect anonymity, campaign donations are organised in such a way that no one (other than the donor - and specifically not the recipient) has any reliable information about the existence, or size, of any individual donation. In this case, so the argument goes, since there can be no proof that a donation has been made, there can be no political deals struck: it is impossible to buy influence if it is impossible to demonstrate payment. Of course, this sketch does not do full justice to Ayres’s argument, but we believe that it suffices to focus attention on the key issues: the idea that corruption takes the form of market-like deals that ‘pervert’ the democratic process in the sense that political outcomes differ from those that would be realised under purely political process; and the argument that such deals are effectively ruled out by complete anonymity. We also note that Ayres’s discussion is informed by a recurring analogy with the process of voting itself - and with the idea, in particular, that the secret or ‘Australian’ ballot provides an appropriate exemplar for secrecy in the political process. We will return to the significance of this analogical reasoning, and to other aspects of Ayres’s specific argument, in due course but first we wish to make some effort to widen the discussion a little. The design of democratic institutions may be approached in either of two styles - a ‘piecemeal’ style or a ‘synoptic’ one. A piecemeal style characteristically focuses on this or that piece of institutional practice and subjects it to scrutiny. A synoptic style is one that attempts to work from general principles in developing an overview of the operation of democratic institutions and to develop thereby implications for the design of particular institutional devices2. Clearly, neither style holds a monopoly on usefulness, and it is likely that the iteration between these styles offers the most plausible route to reasonable conclusions. It is for this reason that, initially at least, we wish to respond to Ayres’s piecemeal proposal in a rather more synoptic mode. Even if we narrow our range of concern to the institutional framework for financing democratic politics, we must recognise that a number of inter-related issues are raised: the relative merits of private and state funding of political parties or candidates; the possibility of regulating either the set of agents who may make political contributions, or the size of the political contributions they may make; the possibility of regulating the flow of information about the financial affairs of donors, parties or candidates; the possibility of regulating expenditures made by parties or candidates; and so on. None of these issues is trivial either in the sense that the normatively appropriate answer is obvious, or in the sense that the same practice has developed almost universally across democratic countries. And matters become still more complicated if we open up the possibility of interactions between these various issues, or with other aspects of the institutional fabric such as voting rules, the structure of representation, and so on. Indeed, it is not even obvious how we should go about addressing these matters. Two ingredients seem essential however - a reasonably clear statement of the model of democratic politics to be used as the test-bed within which to conduct the relevant thought-experiments, and a reasonably clear statement of the relevant normative criteria. Unfortunately, neither ingredient is readily available or widely agreed. The first aim of this brief essay is to say something about the appropriate ingredients to use in constructing particular arguments concerned with the funding of democratic politics or, indeed, any other aspect of the design of democratic institutions. Only then will we return to the specific issue of anonymity in political donations.