Monday, March 22, 2010

A counter-proposal for campaign finance reform

Last week, as the Conservatives opposed the Liberal motion to end out of riding ten-percenter junkmail, then supported it, then opposed it, and then supported it if everyone else supported it (it was among the many Conservative flip-flops last week), they also threw out what many in their camp believe to be a clever ploy: a threat to bring back their attempt to end the per-vote subsidy for political parties.


They’ve since apparently backed off yet again, but I’m sure this threat will be back at some point, possibly as a preferred election trigger to the Afghan detainee document file. After all, would you rather go into an election over withholding documents that would seem embarrassing to your government, or over trying to stop public money from going to political parties? Not a hard choice.

It’s all about politics, of course. The Conservatives do get more real dollars from the subsidy than the opposition parties, because they’ve gotten more votes the last few elections. They have a more robust fundraising operation, though, so dropping the subsidy wouldn’t be as big a hit for them. But the subsidy is a much larger percentage of the budgets of the opposition parties, so really, for the Conservatives this is more about screwing their opposition than it is about democracy.

That’s been par the course on this file for years. In his last days in office, Jean Chretien moved to end corporate and union donations. The Liberals having relied heavily on corporate donations, he left his successor, Paul Martin, with a huge challenge. Chretien brought in the per-vote public subsidy though to compensate for the loss of corporate and union dollars, rightly seeing $1.75 from every voter as a small price to pay for a democratic system freer of corporate and union influence. Then, after the Conservatives came into office, they teamed-up with the NDP to pass a further reform of political financing, again aimed at causing the Liberals grief. Knowing that the Liberals relied on a small number of large donors, as opposed to a large number of smaller donors, the Conservatives, with NDP support, moved to lower the personal donation limit from around $5000 to, today, $1100. They also did it in the middle of the 2006 Liberal leadership race, helping create a mess that still continues today for candidates that budgeted for one set of rules only to have them change mid-campaign.

Since that time, the Conservatives have been routinely making noise about moving to end the per vote subsidy. It has been part of their long-term goal to destroy the Liberal Party as a viable opposition (some would question if we’ve been needing help on that) by bankrupting their opposition. They included such a move in the fiscal update that triggered the coalition crisis, but later backed down. Ironically, by also doing nothing on stimulus or the economy they gave the opposition cover to oppose them; if they’d just done the subsidy dump it would have been hard to risk an election on that issue.

Since that time, though, while there’s still a long ways to go, progress by the Liberal Party in reforming its fundraising machine means that today, the end of the per vote subsidy wouldn’t be the death knell it once was. It would be a handicap, but one that could be overcome. Actually, the party that would be most hurt by the end of the subsidy would be the NDP, which has increased its spending in recent years thanks to the resources provided by the subsidy. It’s ironic, because the Conservatives need a strong NDP to sap Liberal support on the left, so ending the subsidy would be counter-productive to Conservative goals. Ending the subsidy would also hurt parties not in the House, such as the Green Party, that have benefit from per vote subsidy because of their dispersed support across the country.

Still, if the Conservatives insist in trying to kill the per vote subsidy, particularly if they try to do it as a wedge to force an election, I’d like to put forward a counter-proposal: end the subsidy, keep corporate and union donations banned, but raise the personal donation limit back up to $5000.

There was no good reason to lower the cap in the first place. I find it a hard circle to square that Stephen Harper can argue that money is speech when he went to court to fight against third-party election advertising, but he’s willing to abridge the rights of individuals to contribute to the party of their choice. If he wants to end the subsidy, raising the personal limit would be a way to give parties more capacity to compensate for that loss, and would be a difficult move for the Conservatives to argue against effectively and persuasively.

*I’ll be travelling and offline today and throughout the week, so expect some delay in comment approval.

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9 comments:

Chrystal Ocean said...

I couldn't disagree more strongly with raising the donation limit.

Lowering it was one step toward reducing the influence of people who've more money to donate to their favourite political parties. Raising the limit reintroduces or widens the divide between people who cannot afford to donate and thus influence our country's direction - by virtue of supporting the party whose ideology most suits them - and the people who can.

The issue of classism is why I support the per vote subsidy. It enables poor voters to contribute at least something to the party they support.

Another issue concerns the poor and donations to parties. If one's income is so low one doesn't pay income tax, then there is no refund for income tax purposes for political donations. Thus, poor donors are doubly penalized.

Ted Betts said...

You are absolutely right that the opposition to the per vote subsidy is about politics and knee-capping the opposition and not about principle or fiscal prudence.

If the Conservatives gave one crap about fiscal prudence, we would have seen some shred of it over 4 years and certainly in this budget. Instead we see the budget spending increase by even more than the Conservatives had projected last year and the PMO budget increase by $13 million.

As for the principle, if they cared about any principles on this issue they would be talking about the tax deduction subsidy which is far worse, far costlier, far less democratic.

With the tax deduction subsidy, non-Conservatives end up supporting and subsidizing the Conservative Party because we taxpayers pay 75% of someone else's party choice. Worse, the more wealthy donors they get, the more the rest of us have to subsidize the Conservatives. Whereas the per vote subsidy at least has a democratic link - the subsidy is tied to getting votes - which encourages convincing Canadians to vote for you.

Worse, the tax deduction subsidy costs more than twice as much and provides an advantage to the incumbent party.

Worst of all, it provides Canadians with an incentive to donate to political party windbag machines instead of to charities.

If they are talking about the per vote subsidy but not the tax deduction subsidy, they are full of it.

doconnor said...

A $5000 limit gives an advantage to parties who have a high proportion of supports who can afford to donate $5000 (a party that supports the rich) over a party who has a low proportion of supports who can afford to donate $5000 (a party that supports the poor)

Mark Francis said...

I've been from the start about that same thing Ted brought up. The Conservatives deliberately talk as if there is only one taxpayer subsidy: the per-vote subsidy. The other parties seem content to let them get away with this.

To counter it, some party needs to propose doing the inverse: keeping the subsidy, but doing away with everything else -- the hefty donation tax credit, the riding rebates, even the Parliamentary library research allowance.

Now before everyone jumps on me, I don't support dumping these subsidies (reforming...?). It's a PR ploy to call the Cons on their reluctance to admit they want to keep the less visible subsidies.

Tom said...

At the end of the day, it still comes down to suporters paying to suport their party.
Why don't LPC, NDP and BQ supporters support their parties as strongly as CPC supporters do?
Don't hide behind the 'Conservatives are richer' canard. I think most Liberals are wealthier than I am.

doconnor said...

"Another issue concerns the poor and donations to parties. If one's income is so low one doesn't pay income tax, then there is no refund for income tax purposes for political donations. Thus, poor donors are doubly penalized."

Actually the tax refund for political donations are one the few that are refundable, so you get the money back even if you pay no income tax.

Quito said...

I haven't commented on a blog in a long time as Jeff knows but I have to give my two cents on this one.

Personally I'd like to see the initial rules reintroduced, that is allowing for corporate and union donations at the riding level only. This would keep the so called influence that $5000 buys out of leaderships contests, nominations or the central party. Businesses and unions are part of our great country and should be allowed to participate in the political process like all other entities, to say otherwise is to claim they play no role in our society.

This may sound naive but as someone who has donated money to candidates, campaigns and the party when I could, I have never sought or wanted any influence. I am a fan of the Liberal party in the same way that I am a fan of the Montreal Canadiens or the New York Jets. Sure I have spent hundreds if not thousands of dollars buying merchandise, tickets, travelling for games etc but I wouldn't expect to get any input on who the Habs draft next year or who starts at running back for the Jets...don't get me wrong, I'd love to make a few suggestions. I will openly criticize the coaches, players and management on those two teams for their decisions if/when things don't work and praise them when they do. Similarly for the Liberal party.

I understand why Mr. Chretien changed the system by restricting donations to the central party and limiting corporate and union donations at the riding level to $5000. All subsequent changes to the formula, eliminating corporate and union donations entirely, reducing the maximum to $1100, etc, have all been made for political gain by Mr. Harper and the Conservative party.

doconnor said...

"This may sound naive but as someone who has donated money to candidates, campaigns and the party when I could, I have never sought or wanted any influence."

A donor doesn't have to get influence. They just have to find a politician or party who already supports the ideas they want to see implemented and donate to them.

marie said...

A donor doesn't have to get influence. They just have to find a politician or party who already supports the ideas they want to see implemented and donate to them.

Here here!!!! Quito but the Cons do nothing unless it benefits them personally.