Real party donation reform: the city where political finance never sleeps
As the AEC releases political finance data for the year to June 2013, Inside Story's Graeme Orr visits a New York organisation that can teach us a lot about timely transparency.
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What would a rational system for financing political parties and elections look like? It would have three facets: 1) timely disclosure of donations, to shine a light on possible graft; 2) limits on gifts to parties and candidates, to stymie wealthy interests buying favours; and 3) modest public funding tied to expenditure limits, to advance fair competition.
On those metrics, Australia scores nil out of three. We have the Australian Electoral Commission’s annual “disclosure dump”, about seven months after each financial year. There are no caps on the size of donations. And, following each national election, $5 per voter is given to the parties with no strings attached.
New York City is hardly a byword for efficient and clean governance. So it is eye-opening to find a public service here that is at once reliable, democratic, and an international pace-setter. This black swan is the New York City Campaign Finance Board, which oversees donation caps, continuous disclosure of campaign finances and an innovative model of public funding.
As its director Amy Loprest puts it, its overarching aim is to “improve the role of citizens in New York elections”. It does this by seeking to educate and empower the public, diminish the political influence of private money and promote electoral competition. On the metrics of a rational system, NYC bats three from three.
American government is complex and multilayered, and not everything works as it should. Visitors to New York first notice this in the city’s labyrinthine and dilapidated subway. Then there is the venerable post office, a chain of bomb shelters with queues snaking out of the door, yet nearly bankrupt for all that. While it’s risky to generalise about such a vast, patchwork land, it’s fair to say that Americans mistrust institutions less out of ideological suspicion than from a self-fulfilling cycle of neglect. On top of their underwhelming experience of everyday services, they live with corruption in the business/politics axis.
Once emblemised in Tammany Hall, such corruption persists. Just look at the unfolding scandal involving the Democratic state senator who, with his business backers, allegedly bribed Republican party bosses to advance that senator’s bid to run as the city’s mayor. Integrity agencies like the Campaign Finance Board work in tougher thickets than their Australian equivalents.
Before diving into the details of New York’s campaign finance scheme, it’s worth taking in the bigger picture of the Big Apple. Australian local governments handle rates, roads and rubbish. American cities tackle much more. New York’s mayor and its council run emergency and health services, and public housing and schools, and even maintain the nation’s largest urban university. As its recent ban on e-cigarettes shows, the city has many social and regulatory tendrils.
“Australia could learn much from the city’s campaign finance regime.”
New York City famously marries five boroughs or sub-cities into a single administrative entity, more like the City of Brisbane than Sydney or Melbourne’s small, CBD-focused councils. It is not an isolated metropolis, and forms the heart of a “tri-state” district almost as populous as Australia. As a regional magnet, many more folk have a stake in NYC’s economy, culture and governance than enjoy its electoral franchise. In size, scope and complexity, this is a city-state, not a city council. So political legitimacy and integrity are big issues.
The Campaign Finance Board oversees 59 elected offices. At the apex is an elected executive made up of the mayor, comptroller (or treasurer), public advocate (uber-ombudsman) and five borough presidents (playing advisory roles). Then there is a legislative council of 51 ward-based members. The new mayor, leftist Bill de Blasio, succeeded the term-limited billionaire Michael Bloomberg on January 1 this year, and Democrats so dominate the city that only three Republican councillors survived the recent low-turnout landslide. To Australian eyes, though, electoral politics here seems more candidate-oriented than rigidly party-controlled.
The Campaign Finance Board was founded in 1988 during mayor Ed Koch’s reign, by a referendum amending the city’s charter. This was part of a broader integrity drive, following a series of general corruption scandals. The board is overseen by five members, two appointed by the mayor, two by the speaker of the council, and one jointly. Neither the mayor nor the speaker can appoint more than one affiliate of the same party. In the American way, then, the risk of partisanship is not ignored, but managed. The outgoing chair, Joe Parkes, was a Jesuit priest and medieval historian; the incoming chair, Rose Gill Hearn, is an anti-corruption prosecutor. The Board enjoys budgetary guarantees that open it to estimates-style questioning by councillors.
Legislation assigns the board two broad roles. One is to engage electors, by promoting voter registration and education, and so it distributes millions of voter guides, broadcasts candidate videos and holds leadership debates. But as its name suggests, its key remit is to oversee political finances in the primary and general elections for all fifty-nine elected offices. Here, the Board’s powers pivot on two points: disclosure of campaign finances and opt-in public funding.
It is in its comprehensive disclosure system that the board is a leader internationally. To Australians used to only annual or post-election disclosure, the cycle is breathtaking. In the 2013 election year, there were 16 regular disclosure deadlines. On top of this were daily disclosure obligations during the fortnight before each primary and general election day. (Daily disclosure is triggered when a campaign receives more than $1000 from, or spends more than $20,000 with, a single source.) Electronic disclosure, through a secure, purpose-built system, has been available since 1993.